What's Different About Italy?

After passing through Rome, Sorrento, and Venice, most of the group left on Thursday for a free weekend in Salzburg, Austria. Given the non-structured nature of this weekend, I thought it might be appropriate to reflect on some of the most interesting day-to-day economic differences between Europe and the States.

1. There aren’t many chain businesses here. Restaurants, corner stores, souvenir shops, many clothing retailers, grocers, butchers… pretty much everything is independently owned. The natural reaction from any economist would be, “wow, what a great example of near-perfect competition,” and that’s definitely the case. If I had to guess, I’d say the cause of this competition is that most Italians we’ve seen are very local and neighborhood-oriented, and generally do their day-to-day shopping within walking distance. Along with this local shopping focus comes local food focus, with a strong interest in regional foodstuffs of all types. This hyper-specialization probably inhibits the growth of large multi-city chain stores. Besides banks, foreign fast-food stores, and expensive Western clothiers, the only chain store we’ve seen is called “GROM,” a gelato shop with several locations across Italy, where they proudly display their membership in the slow-food movement and carry certifications for the freshness and organic-ness of their ingredients. They’re also vertically integrated, from the cows to the counter, and Alessio (our guide) told us that groups in past years have visited the GROM cow farms to learn about the slow food movement, similar to what we learned about at the Tuscan sheep farm.

2. If someone wants to sell you something, you know about it. Ristorante hosts will block your walking path and guide you in their doors. Street vendors will accost you as you stroll by their stalls. Unlicensed sellers in the public squares will follow you around to show off their wide variety of wares, from the cool (a €15 hi-powered green laser pointer) to the lame (a cheap postcard for a euro). The lack of legal regulations on these “marketing” techniques makes it a viable source of income for some, because the risk of being caught, which provides a disincentive to illegal sales, is removed.

3. When you’re completely lost in a foreign city, you have a very inelastic demand for a taxi. The drivers were on strike, and we found out the hard way in Rome.

4. There’s no Mexican food in Europe, but there are lots of kebab shops. Kebab is a sandwich-like amalgamation of roasted meat, veggies, sauce, tomato, and chilies all stuffed into a roll or wrap. In fact, they’re very much like a burrito. Accordingly, the Hispanic population of the countries we’ve been to – Italy, Austria, and Germany – are miniscule, but they all have sizeable minorities of Middle Eastern descent. Most of the kebab shops are run by this minority group, which identified a niche for exotic, spicy, “different” food, and filled it with kebab. This isn’t the most economy-based observation, but it’s really interesting.

We’ve just now arrived in Cavalese, in the mountains of Northern Italy, where we will be meeting with local authorities to discuss the management of the commons in the Trentino valley.