The Economics of Beauty
The Pink Tax
Why products marketed to women sometimes cost more than similar products for men, what studies found, and whether it's discrimination or segmentation.
The pink tax refers to women paying more for products similar to men’s.
Evidence
A 2015 study by New York City’s Department of Consumer Affairs compared hundreds of products and found items marketed to women cost around 7 percent more on average, such as razors, shampoos and clothing.
Why it happens
- Price discrimination: if women are willing to pay more for certain products, firms charge more.
- Different formulations or packaging.
- Less competition in some women’s product lines.
Services too
Haircuts, dry cleaning and other services sometimes charge women more.
Is it unfair?
- Some differences reflect costs.
- Others are pure pricing strategy.
- California passed a law in 2023 banning different prices for substantially similar products based on gender.
Menstrual products
Tampons and pads have been taxed in many countries. India exempted sanitary napkins from GST in 2018 after campaigns.
Consumer response
Comparing unit prices and considering men’s versions of products can save money.
A woman buys a pink razor for 200 rupees. The nearly identical blue razor costs 150 rupees. Switching saves her money.
Some reflect pricing strategies targeting willingness to pay.
- The pink tax is women paying more for similar products.
- A 2015 NYC study found about 7 percent higher prices.
- Price discrimination and less competition explain it.
- India exempted sanitary napkins from GST in 2018.
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