Monday, October 8, 2007

A Question About Indian Economics (or, OMGWTF SHOES!!!)

I've found, while wandering through Hyderabad, that the streets seem to be set up according to product. That is, on one street a person will find nothing but sari shops; on the next street nothing but household goods; on the third street, sixteen kiranas.

Turning every corner, it becomes OMGWTF SHOES! OMGWTF PERFUMES! OMGWTF BANGLES!

This puzzles me, economically. How can so many people sell the same thing, side-by-side? Sure, it's very useful for me as a consumer because then I can go from stall to stall comparing prices and quality (which seems to really irritate all of the salesmen -- they chase after me calling out "Madam, what is wrong?"), but wouldn't it soon become obvious to everyone on the street which shop was offering the best deals? And then wouldn't everyone try to undercut, purchase better merchandise, whatever?

If there were only one shoe store on the block, everyone would have to get their shoes there. But if it's OMGWTF SHOES!!!, doesn't each individual store lose money and opportunity?

Or is there something else involved?


Daniel said...

Yeah, it happens here in NYC too; that block where we had brunch/lunch dosas that time has about 7 different Indian restaurants on it. I have no idea how they all survive. Also, there's a block not too far from there that has discount perfume stores galore.... WEIRD.

Anonymous said...


Never thought much of it before, but most older markets are set up that way...AFAIK, people do look for deals, but each of the stores builds up a set of regular shoppers who usually prefer that store to its neighbours. I know we do this at my mother's house for groceries - even the same brand-name stuff must somehow be bought at "our grocer" and not at the one across from him!

Sometimes, even among a streetful of stores selling similar merchandise, there are small differentiators...with one shop selling a particular item that others don't.



Anonymous said...

Also, the store owners prefer to work in "their" neighborhood, being tied to each other by bonds of familiarity and often by kinship. So...

Blue said...

Interesting. So many of the people who work on the same street (in different stores) are related to each other? Or are friends?

That's even more fascinating. Somewhere there should be a book about this. (Non-fic first, "case studies" of the people involved, and then the novel and film versions.)

Indianoguy said...

My friend, his elder brother and their cousins, each have their own jewelry shops in the same street in my hometown. The shops you have been are most probably owned by people from the same caste/clan.

Karthik said...

This is funny, because when my folks visited me here, they wondered about how supermarkets stock up on so many things (and huge quantities) yet claim that their stuff was fresh.

I guess you just take such things for granted until you have someone new visit.