Price Gap Narrows Between Korea and the United States

An aspect of this Blog is to look at Korean culture, society, and commerce and then drawing comparisons and showcase differences. With globalization, goods cost similar in developed nations. This Korea Times article points out the narrowing gap in costs between the US and Korea. I'm not shocked since over the past 20 years I've seen the gap narrow.


South Korea's consumer prices have risen rapidly over the last few years, narrowing the gap with those of the United States.

If the average consumer price level in the U.S. is put at 100, that of products sold in South Korea is 95 as of the end of December last year, the National Statistical Office (NSO) said, citing data from the Organization for Economic Cooperation and Development (OECD).

This means a product sold at $100 in the U.S. is priced at $95 in South Korea.

The price gap between the two countries has narrowed 13.1 percent from December 2004, when the price index for South Korea was at 84.

The narrowing price gap between the two countries means that living costs are not much different between the two countries.

Stronger wages and higher oil prices were the main drivers of rises in consumer prices in Korea, while the won's strength against the dollar helped cut import prices, an NSO official said.

If a free trade agreement between the two countries is ratified and goes into effect next year, we would see smaller price differences.

Still, prices in some European countries were more than 50 percent more expensive than in South Korea.