{"id":19923,"date":"2024-08-26T18:00:17","date_gmt":"2024-08-26T21:00:17","guid":{"rendered":"http:\/\/fund.ar\/publicacion\/clothing-prices-in-argentina\/"},"modified":"2024-09-05T17:05:43","modified_gmt":"2024-09-05T20:05:43","slug":"clothing-prices-in-argentina","status":"publish","type":"publicacion","link":"https:\/\/fund.ar\/en\/publicacion\/clothing-prices-in-argentina\/","title":{"rendered":"Clothing prices in Argentina"},"content":{"rendered":"\t\t
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The evidence is overwhelming: clothes are expensive in Argentina. This trend has developed over the last two decades, during which the country has gone against the world. While clothing inflation here has outpaced average inflation, the opposite has happened in the world. To explain the high local prices, the public debate oscillates between critics of the national industry who argue that they are due to high protectionism; and those who attribute them to issues that have nothing to do with the sector, such as the local macroeconomy. Understanding the factors that explain why clothing is expensive is a necessary step towards improving public policy towards the sector.<\/strong><\/p>\n\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t

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Why analyse clothing prices<\/h2>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t
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From mid-2020 to the end of 2022, clothing and footwear were the chapters of the consumer price index that increased the most. This sparked a controversy over the causes of the increases.<\/p>\n

The public debate oscillated between the two positions. On the one hand, critics of the national industry blame protectionism and argue that lowering prices is only necessary to open up the economy and encourage imports. On the other hand, the other view argues that the high prices of clothing are due to a multiplicity of factors, all of which have nothing to do with local production.<\/p>\n

The explanation for the phenomenon is more complex. During the last two decades, high external trade protection was a central factor in justifying the differential evolution of clothing prices in Argentina with the rest of the world. But it is not the only one. Deteriorating macroeconomic conditions contributed to higher relative prices for all goods, including clothing. It also affected the cost of financing, which in turn constrained investment and productivity growth.<\/p>\n

Recognising the complexity of the problem of clothing prices is central to improving the state of the current debate and the design of public policies. It is key to providing an answer to the question that triggered this Fundar series: what to do with the Argentine textile industry?<\/a><\/p>\n\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t

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What does it mean that clothes are expensive in Argentina?<\/h2>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t
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Absolute prices, relative prices<\/h5>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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Clothing is expensive in the country both in absolute terms -i.e. in dollars- and in relative terms -about the rest of the goods and services in the economy-. In absolute terms, a basket of clothes in Argentina is 35% more expensive at the official dollar compared to the average of the same basket in other countries in the region -and 16% at the MEP dollar-. At the same time, the prices of clothing and footwear in Argentina are among the highest in the world compared to the rest of the goods and services in the economy.<\/p>\n\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t

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How expensive is clothing in Argentina in dollars (absolute prices)?<\/h3>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t
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The analyses that usually circulate refer to the price of a few products of specific brands, from which conclusions are drawn about the whole market. However, Argentinian families buy around 77 different types of garments (which make up a basket of clothing), of a wide variety of brands and qualities. To get a more detailed picture, we compiled information on 389,621 retail publications of 33 different types of garments for Argentina and six other countries in the region (Brazil, Chile, Colombia, Mexico, Peru and Uruguay) on Mercado Libre, the leading digital commerce platform.<\/p>\n\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t

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Clothes are more expensive in dollar terms than in other countries in the region<\/i><\/h4>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t
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