Lisbon’s Price(less) Discrimination

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Price discrimination is a general practice everywhere and the price formation could be influenced by various factors. Lisbon has the merit to be one of the cheapest capitals in Western Europe, and exposed to the laws of price discrimination. In the warm capital of Portugal you can drink a coffee for €0.50 or €1.60, buy bread for €0.30 or €1.50 and pay for a beer €0.90 or €2.50. A few hours walk on the climbing streets of Lisbon can give an impression about how prices may vary. It may be very sunny, so better to take the sun cream and a bottle of water.

Tourists are the city’s godsend

Few years ago, Lisbon was not a much hunted destination for holidays. Times changed and the afflux of tourists also influenced the prices: prices blew up in certain areas or, on contrary, tourists can benefit of advantages more than the locals.

On the famous street of Alfama district or Bairo Alto narrow streets, you can listen the fado (traditional Portuguese music), enjoy seeing the street art graffiti and try to walk through the sea of people. “It’s still not full of people, just wait for July and August”, mentions João, a 25 years old graduate. He always lived in Lisbon and now he cannot recognize anymore the silent city he used to live in. “Lisbon didn’t really know how to take profit on the presence of tourists and now people are trying to do everything to get their money”, says João.

 

 

 

The tourists are going in the most visited places of the city and try the local foods and drinks. The traditional markets in Lisbon are the places where prices are normally affordable. In the very famous and old Mercado da Ribeira situated at two steps from Cais do Sodré, a visit on Saturday morning can be an out of the box activity. Fátima is selling olives since few years now and says that most of her clients are tourists. She even learnt few words in English to welcome the visitors. She doesn’t know exactly what “preço discriminado” is but think is not something good. Explaining her that compared to €2.8 for 1kg of her olives, I would get only half of kilo in a supermarket help her to make it much clear.

 

 

On the other half of the mercado, there is a huge place for having a drink or to eat surrounded by little stores. Barbara is selling canned sardines and tuna, “made in Portugal”, she says. Before even to ask her about the prices, she’s saying that this store is more expensive as people are paying for the quality and their respect they have for the fishing. “You are paying here €2.30 for 120g of a canned sardines and you can find the same quantity at half price elsewhere” (even less than half, I would add). “It is not because it is a touristic place, but because we have very good products at high standards”, informs Barbara. 

 

 

Every single tourist in Lisbon is eating the traditional Portuguese cookies pastel de nata. The right place to get them is Belem, the district at 20 minutes by tram from the city center. Once get off from the tram, you can easily see the every time queue in front of the only one pastelaria. You pay €1 for one Pastel de Nata which is as big as the bottom of a cup. In another parts of the city, there’s place for cheaper prices: €5.5 for 6 pastel de nata in boutiques in the corner streets and even €1.76 for 4 cookies in supermarket packed on same day.

 

 

So there is no positive discrimination for tourists? Wait a second. Susana Santos is the Director of External Relations of El Corte Ingles – one of the biggest commercial centers of Lisbon – and explains how the Spanish brand focused its attention on tourists by giving them special cards. “Nowadays people are getting used with loyalty cards and different prices – somehow with positive discrimination. The explanation for tourists is very simple: all have a short staying coming to visit the city, so they cannot be able and they don’t have time to benefit from this opportunity that we are given to them”. This special card is given upon request and only to the tourists by presenting the passport. You can be foreigner living in Lisbon but you will not receive this card. This is the typical case of price discrimination as resale is not possible. Considering the fact that usually the tourist places attract higher prices for visitors then locals because during their holiday because they are willing to pay more and care less about the pockets, these tourist cards are an example of atypical price discrimination. 

 

 

Lisbon seems somehow to live around tourists. There is place for bargaining in some places (especially in open markets) or for getting a ride in a citytuk three-wheeled cabin for uma experiência única – a Lisbon city tour is at negotiable price. 

Tourist or local, the rent in Lisbon is said to be cheap. But was does it mean cheap? For a national minimum wage in Portugal of €530 since 1st of January 2016, paying €300/month with bills included in a shared flat could be extremely expensive. Further to the city center and with a lot of time searching, rents can be around €200/month. It may be very weird, but most of the landlords will refuse to sign a contract but they still ask for a security deposit. Basically, the trust is playing hard and not paying taxes too.

 

 

Prices in Lisbon are a particular example of the country’s economy. João, the student from the beginning of this article, considers that prices rested pretty the same during the rush years of crisis – still very high for locals, but at least this stability of prices attracted all the tourists that Lisbon welcome so well today. Portugal was one of the most hit countries by the financial crisis. After measures of austerity imposed by Troika (European Commission, IMF, European Central Bank), the country is finally in a recovery process and experts are expecting to see a substantial growth of its economy for the next years. Hopefully, the prices will be surrounded by positive discrimination and continue to attract worldwide tourists.

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