Eli5 why airlines tickets from country to country are 20 euro when taxi from town to town is 20
In: Economics
In short, because the demand for taxis and demand for planes is financially worth exactly the same. The fact one is a plane going far, and the other is a car not going so far, is largely irrelevant.
Lots of things affect supply and demand, but that’s ultimately what it comes down to. Companies will charge as much as they can to maximise their revenues, and so these price points represent the maximum they think people will pay for those products/services. Ergo, if two things are priced the same, it’s because they have the same relative demand and supply.
If there are lots of big planes with only a limited number of people wanting to fly, then plane tickets will be relatively low. But if there are lots of people wishing to use a limited number of taxis, which can only take a handful of people at any one time, then prices will be relatively high.
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