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M9 a "Veblen Good" ???


scott kirkpatrick

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Mike Johnston at TOP has weighed in with a piece that reads as if it has been fermenting inside him for some time. Leica, he has now decided, is a Veblen good, an economic anomaly of which the more it costs, the more are sold. He is ignoring the S2, which will have trouble pulling off that feat, and focuses on the M9 announcement.

 

Is anyone here disappointed to see a $6995 pricetag, hoping for $8k, in their dreams paying $9995? I didn't think so.

 

scott

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Anyway, I somehow doubt that Leica cameras qualify as Veblen goods, as their status is only recognized within the photographic community, not so much by the general public. And within the photographic community, at least the sensible part thereof, the status is coupled to the quality, not the bling factor per se.

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In a Western World where the median salary is probably in the €4000-€5000 range, a M9 is about one to two months salary and assuming net savings of 20% a month, this is about 6 months of savings. So to the average worker, this is a substantial investment. Nevertheless if photography is his passion (like it could be watches, cars, hi-fi or whatever) , is camera is all day with him and will last 5 years, €5'500 M9 is within reach, depending of course on his priorities.

 

I don't believe in the Veblen theory either as 99% of people will react to a Leica as a cute little antique camera and have no clue that a new digital version costs a month salary. So the snob effect is pretty low here IMO.

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Les cadres touchent un salaire de 5 366 euros en moyenne.

 

 

The second part of the statement goes on to say that the average monthly salary of the middle classes, I would say that is the low end of Leica's target customer profile (no negative slur intended), is 5366 Euro.

 

 

 

Are you sure about this ? This site states that the average salary before tax is 2661 euros in France.
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Are you sure about this ? This site states that the average salary before tax is 2661 euros in France.

 

Yes, but if you factor in the US, Japan, Germany that are Leica's big markets, I think it is not too far off, especially since most households have more than one salary nowadays.

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In Germany, in 2006 the average salary was just over 40.000 Euro a year.

In our country the highest listed salary is for airline pilots, average 10.701 Euro a month, top 21.701 a month. All middle class professions are between 4000 and 7000 Euros a month average.

Gemiddeld Inkomen > Per beroep

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In Germany, in 2006 the average salary was just over 40.000 Euro a year.

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but not as a net income...... from this salary in germany approx 55% get paid as net income to your bankaccount....the rest is tax, health insurrance, retirement, social etc etc

 

and i do not believe many people in this income class have 20% of their net salary available to save....

 

just my 2 cents

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The second part of the statement goes on to say that the average monthly salary of the middle classes, I would say that is the low end of Leica's target customer profile (no negative slur intended), is 5366 Euro.

 

no, no, "cadres" does not mean "middle class" it means directors, etc. And these indicators are salary before tax.... I don't know what the average income tax rate is but in Belgium where I live, work and pay taxes it's about 40% (!!!) for my income level.

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That would mean the average income in France is a bit lower than the Netherlands, and considerably lower than in germany (in so far as these figures can be compared. )And yes - we go up to 52 % income tax over here..:(:mad:

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That would mean the average income in France is a bit lower than the Netherlands, and considerably lower than in germany (in so far as these figures can be compared. )And yes - we go up to 52 % income tax over here..:(:mad:

 

Of course the number will be different from country to country depending on income tax rates, inflation rates, housing costs and a whole lot of economical factors. But my point was that yanidels estimate of an income of 4000-5000 euros after tax per month for one salary just seems way over the mark.

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how about Sweden and Denmark? they have probably highest taxes. probably 60% :p

 

Not 60, but close enough. :-) The level is progressive, and increases with the income. Juniors starts at around 30% and seniors end up around 55%. But, as with everything, there are ways to get a 'discount'.

 

It's hard to compare income levels without also comparing expense levels, such as health insurances, costs for savings that goes to pension funds, etc.

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