Since the introduction of the euro in the form of actual notes and coins, there has been a lot of grousing about the price increases that have resulted from the changeover, especially since the official inflation statistics fail to capture the full effect. In this vein, the Italian consumer advocacy group ADUC is calling on Italians to boycott pizzas today. Except what they're really complaining about is the markup that pizzerias charge, not any price increases.

The actual press release (scroll down to "Prezzi: Pizza, ma quanto mi costi?") describes how they've come up with their data. They've taken the basic ingredients of a pizza margherita at supermarket prices, added them up, and came to 49 eurocents. The 210g (about 7oz) pizza this makes sells for 5 euros, a markup of 920%. Outrage!

This is of course a nonsensical analysis. The cost of making a pizza is more than just the costs of the ingredients: there is the overhead from having a physical location to do business, paying for the employees who cook and serve the pizzas, keeping the place clean and sanitary, buying ovens and other tools of the trade. A more useful analysis would have been to look at prices now and a year ago, or to look at prices around Europe.

The whole ADUC press release is an exercise in muck-raking. It says that they simply used the logic that 2+2 equals 4, and not 4000. Then they go on to say that applying the same markup on an orata (a kind of fish) selling the stores for 15 euro per kilogram, would mean paying 150 euros (about $150) in a restaurant. Highly deceptively worded, because first of all, the economics of making food in a restaurant involve much more than just the cost of the ingredients, but also because they switch from price per kilo to claiming that it would cost 150 euros in a restaurant... but who would order a whole kilo of fish in a restaurant? That's about 2 pounds!

A rather shameful exercise in all. Apparently nobody at ADUC has actually ever run a business if they really think they can apply this kind of logic. Sadly these kinds of "consumer advoacy groups" tend to degenerate from their initial ideals into business-bashers pure and simple. And that's a real shame, becase a vocal consumer is essential in a market economy. But this is beyond vocal; it's shrill.