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The Italian shortage of small notes
Thomas Kaminski, a loyal MR reader and current resident of Italy, writes to me:
There doesn’t seem to be enough currency in small denominations in circulation. Wherever I buy something, the merchant or cashier seems to ask for smaller bills or coins. Back home in Chicago, if I go into a Starbucks, I don’t give it a second thought if I give the cashier a twenty dollar bill for a $2.50 purchase. They always have plenty of change. Here, even in some supermarket chains, the cashiers constantly ask for exact change or at least for notes in smaller denominations. And when I go to a museum, they often seem to have no change at all...My wife, who is not as familiar with the currency as I am, says that she hates carrying any bill larger than a 10; she constantly gets dirty looks or has to endure sighs of frustration if she tries to buy a cup of tea and doesn’t have small change. And you should see the complications if you try to buy something from a street vendor and don’t have exact change. What is equally annoying, whenever I go to a cash machine, all I get are 50-Euro notes.
I had the same problem in the old days of the Lira, but I am surprised it continues to plague the Euro in Italy and yes I've had the same experience here in Venice. Is the Italian central bank simply refusing to print up the right denominations? If so, given Eurofication why don't the proper size notes flow into Italy where they are most needed? Or should I assume that Italians do not carry socially optimal cash balances at hand? Is there a heavy tax on cash registers and other forms of monetary storage? I remain puzzled.
Posted by Tyler Cowen on April 3, 2007 at 02:15 PM in Economics | Permalink
Comments
this is also a common problem in Mexico, or at least was when I lived there from 97-2000. Even in "real" stores with air conditioning and mall cops, the clerks
would agressively hound you for smaller bills.
Posted by: Kevin at Apr 3, 2007 2:32:01 PM
This was a big problem for me when I lived in Russia (99-01). It was very difficult to spend anything larger than a 100 Rubble note on any purchas of less than 100 Rubbles, especially early in the day. Part of the problem was that stores and cafe and the like rarely started out with sufficient money in their tills- sometimes they started with almost no money in the till at all to make change. To some degre this was just bad buisness sense, but I think it was also to try and prevent stealing by the employees. The problem grew less bad as time went by and is hardly around now.
Posted by: Matt at Apr 3, 2007 2:38:35 PM
Do they take check cards?
Posted by: josh at Apr 3, 2007 2:41:02 PM
It's a bit of a problem in the U.S., too. When I go to the ATM, I withdraw $80 (more than once, if necessary) to make sure the machine doesn't spit out any 50's, since they can be a pain to use.
Posted by: Slocum at Apr 3, 2007 2:45:43 PM
Italy, Mexico, Russia.
chilled...
Posted by: Kerub at Apr 3, 2007 3:05:28 PM
Different areas have different expectation. When I was in school in Boston, I had to carry around cash to pay for things. That's just how it worked. Sometimes it was the family owned Chinese restaurant that would only accept cash so they could dodge their taxes. Othertimes it was a convenience store that simply wouldn't allow credit card transactions for small charges. Then I moved to Texas. Not only do I pay with a credit card everywhere, if I go out to eat with friends, well all make individual charges on our cards to pay for the meal. The restaurant is just expected to bear the cost and so they all do. I would imagine in Italy it is just expected that you can provide the correct change. The store is just unwilling to expend the effort to insure an ample supply of small coinage is on hand. They can get away with it because that's just how it is. Or so I would bet.
Posted by: mpowell at Apr 3, 2007 3:37:59 PM
This happened for me in Costa Rica as well. I chalked it up to no merchant wanting to get stuck with a large bill that could be counterfeit (I have no idea if that was a concern down there though).
It was really weird walking around with 150,000 colones. At least the exchange rate was easy to figure out by doubling the colones and then wacking off three 0's. Unless you became confused after one too many Imperials and thought you had to divide by two.
Posted by: BlogReader at Apr 3, 2007 3:39:47 PM
I remember reading that (in the seventies and, to a lesser extent, afterwards) the Banca d'Italia didn't mint enough of the smaller value lira coins. If that's no longer the case - and I presume that someone at the ECB is checking about the number of Italian-face eurocents being minted - then I guess the habit amongst shop-owners stuck. (Hand-waving path dependency explanations as and when required).
Posted by: Chris Hanretty at Apr 3, 2007 3:40:02 PM
I am a cashier in Denmark. When we start the day, we start with 2000DKK (~250$) in the till. Half is in denominations of 100DKK or more, half in denominations below that. In order to be able to efficiently serve our customers, we try to give the most efficient change every time. To do this, we exchange 3000DKK in large denominations for smaller denominations around 2 O'clock. If we stick to this routine, we *never* run out of change and remain efficient all day.
The only time we've tried running out of change is when all clerks are at the tills serving customers. This leads to slower serving of the customers and is thus not very popular with us at all, since customers are (very) bothered by it. The customers in our small (2000m2) super-market seem to prefer to give out large bills and receive change in smaller bills. Only old ladies and housewives prefer to fiddle with their small change in order to give exact change.
I wonder what culture would lead to a suboptimal distribution of change in the tills? Perhaps one where the cashiers have a lot of time on their hands, exchanging shoppers' convenience for less hassle with exchanging change? Or perhaps one where the average shopper is of the "old lady, housewife" type?
I am surprised this is a problem that street vendors have, since they are actually more likely to have small change. Our chain (Coop Denmark) did a study a while back that concluded that places where the average transaction is less than 50DKK, would be more likely to have small change left over at the end of the day than places where the average transaction is more than 50DKK. Empirical evidence from our in-store tobacco shop confirms this: There is always a surplus of small change at the end of the day. Vice-versa for our main register: It's the black hole of change, you can just keep on pouring 20s and 10s into it, it will always need more.
Posted by: Peter at Apr 3, 2007 3:45:28 PM
Actually, 2000DKK would be more like 350$. That a dollar is supposed to be ~8DKK has stuck with me, though it is no longer true.
Posted by: Peter at Apr 3, 2007 3:58:55 PM
It was also a problem when I visited Egypt. All you could get when you changed money were large denomination notes. I took this as evidence of a conspiracy by the banks to deny small change to foreigners so that you would be forced to let the locals "keep the change" (because they never had any change). On the other hand, the large bills worked just fine at the duty-free liquor store, where I waited patiently behind some devout Saudis who were buying quite a few bottles of Johnny Walker.
Posted by: Ned at Apr 3, 2007 4:00:19 PM
Drug dealers and mafioso are sucking up the small change.
Posted by: Mafia at Apr 3, 2007 4:08:06 PM
Actually, Mafia could be right. Drug-dealing and organized crime tend to prefer dealind in small currency. However, smaller currency tends to become more available in neighbourhoods where drug-dealing is rampant. It may have been you were in neighbourhoods where drug-dealing and organized crime was NOT rampant, thus they were perpetualy sort of small denominations.
Posted by: Raging Ranter at Apr 3, 2007 4:19:25 PM
Keeping small change is expensive. If left to their own, most businesses will end up with larger bills and distribute their smaller bills (because people buy things and get change in return). I used to work at McDonald's and an armored car would take our large bills and deliver small ones (and change). For this the store paid a nominal fee which was passed on to the customer. In the states, people expect exact change so it's worth it to pay it. In the bulk of the rest of the world, people don't so it isn't.
Posted by: vc at Apr 3, 2007 4:21:40 PM
It was (and, I believe still is) a common problem in India too. What is more, depending on the money you have to pay, the rounding to the nearest amount varies too. A bus conductor might not return you a 50 paise change on a 4.50 rupee ticket, while an autorickshaw driver might not return 2 rupees change on a 48 rupees fare. And, in shops, instead of change you might get choclates!
Posted by: Guru at Apr 3, 2007 4:30:45 PM
It's somewhat similar in Germany (also Euro land), even though not as extreme as described in the article. But I wouldn't blame the Euro for that. Many shops, especially smaller ones, just don't keep enough change..
Posted by: Tim Jansen at Apr 3, 2007 4:40:02 PM
I agree with Chris Hanratty - it's a bad habit that's stuck. When I was in grad school it wasn't uncommon to get pocket change in hard candy, bus tokens, or stamps...there simply weren't ANY lira centesimi coins and few small denomination bills.
I think the habit's stuck. If I were a shopkeeper I wouldn't trust the government of Italy!
Posted by: Michael Tinkler at Apr 3, 2007 4:40:24 PM
For an account of this in India see:
http://santoshecon.blogspot.com/2007_02_01_archive.html
For an account of this in Egypt see:
http://armchaircapitalists.blogspot.com/2005/10/cairo-calling.html
For an account of this in Senegal see:
http://armchaircapitalists.blogspot.com/2005/09/how-government-determines-supply-of.html
Posted by: Isaac at Apr 3, 2007 4:44:23 PM
Don't illegal drugs cost too much to be sucking up the small bills?
Although it has not seemed quite as bad recently, I have long noticed a tendency to a
sort of shortage of 10 dollar bills in the US.
Regarding Russia, I must tell a story, although it is really a hyperinflation story.
So, in 1992, after the breakup of the USSR, there was hyperinflation in Russia. I was
in Moscow for a conference in August. There had not yet been a changeover to a new money,
and there was a massive shortage of copper kopeks (officially worth a hundredth of a rouble),
as the copper value in them had come to exceed their face value. So, they were getting
melted down.
Anyway, it used to be that there were pay phones on the streets of Moscow. They cost two
kopeks and did not give change. You had to have kopeks to use them. In the badl old days
of Communism, one used them to call anybody, as they were not generally bugged, but hotel
phones were. Anyway, in August of 1992, the old phones were still there in the street,
requiring two kopeks, exact change. My wife wanted to call somebody, and had to give three
roubles to obtain two kopeks to make the call. That would be like paying three dollars to
get two pennies in the US.
Posted by: Barkley Rosser at Apr 3, 2007 5:06:53 PM
The stores that demand exact change may not make many bank deposits and so not have an opportunity to keep a supply of small bills and coins in petty cash. At my store we start the day with ones fives and tens and misc coins in the registers. I have a lot more change in petty cash so that in the course of the day I can keep buy more coins or small bills from it for the registers. We could go perhaps three or four days doing this before we ran out of some particular denomination or coin (most likely pennies or quarters). To avoid that we get change from the bank everyday with the cash deposit. I would bet that places that run out of change simply don't go to the bank very often or only use a night drop. The businesses could be trying to hide cash transactions from taxes or have few trustworthy employees.
Posted by: Mike at Apr 3, 2007 5:24:12 PM
In Venezuela , circa 1996, was enacted a law to punish the melting and exports of coins.The nominal value was far below the intrinsic value.And in Aruba and Curazao people were using venezuelan coins to cheat at game macchines.
They have to put in circulation 1 cent of dollar bills.
And like many commentators have said little shopkepper never have exchange in the mornings.
And credit card can not be used to buy goods on sale or get discounts.It is illegal but...
Posted by: jcm at Apr 3, 2007 5:42:53 PM
Hey. I've been living in France, and I have a similar experience here, too. At grocery stores, tobacco shops, bakeries, -any place I won't use my bank card,- I'm often asked for the exact change, or smaller bills. I thought it was just a little french quirk about money, since cashiers are also always adamant about giving me back exact change [like, if I'd rather walk away and they keep the small coins, they'd holler at me to come back and get that one centime].
Posted by: al at Apr 3, 2007 5:46:14 PM
In Japan, the smallest bill is 1,000 Yen (about $8.50). There are no small bills. There are 500 Yen (~$4.25) coins.
1 Yen is, of course, pretty useless, like a penny.
Posted by: Mr. Econotarian at Apr 3, 2007 5:54:55 PM
This thread is reminding me that one of the things I like about living in Vegas is no one bats an eye if you pay for things with $100 bills.
Posted by: Jacqueline at Apr 3, 2007 6:13:05 PM
In the bay area I would have no reservation about paying for a $1.13 bag of chips with a $100.
Posted by: Bill at Apr 3, 2007 7:03:10 PM
This was not a significant problem in Spain, though that's partly because the cash machines gave out lots of 10E and 20E notes. Sometimes 5E.
It's generally not a problem in California, where you can *only* get $20 bills from most ATMs. The main exceptions I've noticed are in stores which normally have low sales volume and have just had a big rush, or it's the end of the day on Sunday, when they can't get small bills.
Actually, I've noticed that quarters are the denomination which stores run out of most frequently. I suspect that's because most parking meters and most coin-op laundry machines (and many others) only take quarters.
Posted by: Anthony at Apr 3, 2007 7:04:00 PM
The lack of bills actually worked out in my favor in Rio de Janeiro, Brazil. As I picked up my laundary from Speed Queen in Copacabana the total came to R$22. Ready to hold my ground, I pulled out my R$50 bill and gave it to the attendent. As expected, I was asked whether I had a R$2 bill so that I would be paying with a 50 and 2 and recieving a 20 and 10. [i.e., (50+2)-(20+10)=22].
Here is where the battle begins, because I want the small bills too. I say I have no R$2 bills, but concede that I do have a R$1 bill, noting that unfortunately that won't help in the current situation. To my surprise however, the attendant took the R$1 bill, and still gave me a 20 and 10 in return. So I ended up paying (50+2)-(20+10)=21, saving ONE REAL!!! Wahooo.
Posted by: Jeff Shepley at Apr 3, 2007 7:06:26 PM
I'm told that the 1 yen coins (silly aluminium coins) do have a use since the Japanese sales tax isn't included in the sales price, and ends up coming out at strange un rounded amounts, like 67 yen, so the 1 yen coins get used in that capacity. I've noticed a tendency among Japanese (regardless of country of residence) to pay, say, a $5.40 charge with a $10 note and 40 cents in order to get higher demoninations in change though.
Posted by: Richard Green at Apr 3, 2007 7:16:16 PM
As Tyler said, there was the same problem with the Lira. I think it is more of a cultural thing than a currency shortage issue. When I was living there in the mid '90s (95-97), this was a constant problem. If you gave them a larger bill, they acted very put out.
Posted by: Ryan Israelsen at Apr 3, 2007 7:21:58 PM
I'm fairly sure it's an old habit that hasn't died yet.
Compare: in Italy, there used to be such problems with the former currency, the lira - and the problems still exist with the euro.
In Poland, where I currently live, they used to have such problems under the old system, and also before the revaluation of the złoty in the early 90's. And nowadays, for no obvious reason, cashiers usually ask for exact change, or exacter change than is convenient. Interestingly, it depends on the cashier. Some will accept a large banknote without hesitation, while others will plead for that 4 grosze even before you touch your wallet. Those not-so-common cashiers who accept anything are almost always quite young (under 30 or so).
Third example: In Ireland, which like Italy replaced its former currency with the euro, but which unlike Italy never had this obsession with change, there is currently no such obsession.
Posted by: ataltane at Apr 3, 2007 7:26:22 PM
Having traveled extensively I can assure you that this is hardly limited to Italy, but this behavior trends to occur in less affluent countries, or other places that have lots of small under capitalized businesses. It seems that often they start the day with nothing in the till, so making change is tough. :)
In places with high inflation rates (so businesses don't want to hold cash) you sometimes see the same behavior, but I suspect under capitalization is the main cause.
Posted by: Jonathan at Apr 3, 2007 7:27:12 PM
Your point on a tax on cash registers may not be too far off the mark. In Italy it is the law that you must receive a reciept after ANY transaction. This may thus have the effect of making cash registers more expensive and discourage firms from investing in them, this may result in more labor being used to make these receipts and reduces the amount of time they are willing to spend dealing with change. If Italian stores have a very differentiated market from the worldwide cash register market (due to their unique receipt producing needs) this may reduce the Italian cash register market size and lead to a higher cost of production of italian style registers. So this law may be a the cause of fewer small bills behind the counter.
Posted by: Ben at Apr 3, 2007 7:27:49 PM
There's a classic paper, The Big Problem of Small Change, that, although it specifically deals with the problem of keeping an adequate supply of two denominations of coinage around when both are hard currency, does make one point that stands even with fiat currency: if there are some important transactions that can only be resolved with small change, then if a shortage of small change develops, then it will become self-reinforcing through hoarding.
I can see that countries with large informal sectors might fall into this trap, if the typical informal transaction is usually small, or resolved in small change even if for a large sum.
The observation regarding street vendors can be explained in any locale plagued by hoodlums, organized criminals, corrupt police forces, or any other sort that might demand a cash payment from the vendor, in a way that any poker player will appreciate. If the vendor is known to have a few large bill or few, it is easy to judge whether to hit him up for a payment or not, and if the amount of payment is to be negotiated, where to start the negotiation. If the vendor has only a pile of small bills, then assessing his potential value is more difficult.
Posted by: Cyrus at Apr 3, 2007 7:29:43 PM
I have noticed a similar issue in the UK, though it is by no means universal. When traveling there, I will run into problems the first couple days, when I haven't built up a reserve of small change by spending my 20 pound notes that I got from the ATM. The problem seems to be more accute in non-tourist areas. Paying a 2 pound museum fee with a 20 pound note isn't an issue, but I've actually had convenience store clerks refuse to sell me small value items if I only had a large bill available to pay.
Posted by: Rob at Apr 3, 2007 8:08:16 PM
Ummm, anyone here heard of credit cards?
Now, care to speculate how the percentage of credit/debit card sales has increased?
Cards always pay the exact amount, yet never put cash in the till. Cash buyers tend to pay with larger bills vs. exact amounts, thus pulling smaller denominations out of the drawers.
Less in, more out, short of change.
Posted by: charlieq at Apr 3, 2007 9:36:09 PM
two thoughts that don't appear to have been mentioned here yet: central banks, esp. in countries with much tourism such as Italy, have a big incentive to encourage the use of bills and small coins, as they result in high seigniorage benefits. it may be that coins and small bills don't make it to retailers because the banks that serve them are uninterested in providing such customer service efficiently or affordably -- a cultural issue not unknown in many parts of the world mentioned above.
Posted by: JM at Apr 3, 2007 9:45:13 PM
I dont know if is still true but in Europe the bank charge shops more for accepting debit card than credit card.So not every shop accept them.I was unable to use it in some large retailers(It was 2002)And as i said at least in one country the payment is larger using credit card than using cash.Discount and sales cash only.
Posted by: john at Apr 3, 2007 10:19:13 PM
I worked at Wal-Mart in college and we used to get 225 or so in change (a wad of 5s ($100), a wad of ones ($25), 4 rolls of quarters, 2 nickels, 1 dime, and 4 penny rolls. It was only an issue once when two of the first couple of customers paid with $100s for relatively small bills (under $20). I had to call for change to break the last one. Almost every shift you ran out of coins of one kind or another. Most shifts ran out of 1s. Smart cashiers would get change well before they needed it (the change runners were tremendously busy). Best night was when I was working electronics and some kid paid for a video game with his piggy bank, didn't have to call for change for the whole shift.
I was surprised that the mix was 40% cash, 40% credit/debit, 20% checks. That and it felt pretty odd to be carrying 7k in small bills when you stopped to think about it (on a day with 20 checkers going like mad).
Posted by: nelsonal at Apr 3, 2007 10:39:14 PM
This is a huge problem in Poland as well. After living there for a year I have gotten used to making as exact change as possible. I remember a Japanese roommate of mine who was in Ukraine, and a lady noticed he had coins (but they were Polish, not Ukranian)-- she started screaming at him to pay her in change, he didn't understand but thought it was hilarious!
Posted by: Michael Jurka at Apr 3, 2007 11:38:47 PM
I'm told that the 1 yen coins (silly aluminium coins) do have a use since the Japanese sales tax isn't included in the sales price, and ends up coming out at strange un rounded amounts, like 67 yen, so the 1 yen coins get used in that capacity.
That used to be true, but recently the vast majority of goods that I've seen have their before and after sales tax price listed on the box, and the after-tax price is the round number that's in a multiple of 5 yen (and usually 10).
Least convincing thanks I've ever gotten from a Japanese cashier was when giving her 5 of those aluminum discs as part of exact change, to get them out of my pocket.
Posted by: John Thacker at Apr 3, 2007 11:42:25 PM
This is a serious problem in Brazil. My theory is that merchants don't carry a lot of change because they are concerned about being robbed.
There is also the matter that they are not getting "interest" on the money that they carry. When inflation is high, this "interest" can be very large, and these poor people can't afford to keep their money out of the bank.
Posted by: Gustavo Lacerda at Apr 4, 2007 12:00:03 AM
This crops up in reverse inHong Kong, where there the HK$1,000 note (about US$128)that is largely useless as cash. So why does is issuance of that note keep rising?
http://simonworld.mu.nu/archives/219761.php
Money laundering and Macau's casinos are two potential answers.
It seems that many central banks don't do a good job of managing the supply of cash to the economy's needs (I'm not talking about general money supply, but rather the mix of bank notes/coins). This is true even in Hong Kong, where commercial banks (not the HKMA) print the notes (see http://en.wikipedia.org/wiki/Banknotes_of_the_Hong_Kong_dollar ).
Posted by: Simon at Apr 4, 2007 2:26:05 AM
England had this problem in 2001-2002. It appears to be fixed now.
Posted by: sammler at Apr 4, 2007 3:54:14 AM
I lived in Japan for a couple of years in the mid-90s and visited frequently for several years afterwards up to the early 00s, and was always amazed that there was no problem using a ¥10,000 note (about $100-120 when I lived there, ~$80-85 now) for any transaction. One could go into a fast-food joint or a noodle shop, present a ¥10,000 note to pay for the ¥500 tab, and the cashier would cheerfully dig out whatever change was necessary. I'll admit I never tried this with the woman at the newsstand where I bought my morning paper, though.
With regard to the worthless little aluminum discs (¥1 coins), I found there were two strategies the restaurants I used to frequent for lunch used. Some would post prices (say, ¥850) inclusive of consumption tax, and let their cash registers keep track of how much was price and how much was tax. Others would post prices before tax, and have the cash register round the change up to the next ¥5 or ¥10. So a ¥780 lunch would go to ¥819, and I would receive change of ¥185 or ¥190 when paying with a ¥1,000 note. These restaurants wouldn't accept ¥1 or in some cases ¥5 coins if you tried to present them. They just didn't want to deal with the small stuff.
Posted by: Don K at Apr 4, 2007 5:52:39 AM
Note To Mr. Kaminski...
I, too, have Illinois roots and live in Italy.
Work in Milan, live in Bergamo.
Drink?
Posted by: glenn at Apr 4, 2007 9:49:50 AM
The problem is simple - either the shopkeepers keeps a big float of small change or the shopper does. It is not efficient for both to keep lots of change - only one of the parties needs to do this, so countries either stabilise around the shop or the shopper as the change holder. After all - why would a shop keep lots of change if no-one ever asks for it, or a shopper keeps lots of bulky notes or heavy coins, if the shops are willing to take big note. The locals know the system and are organised for it. The problem is only noticed when one moves from an area where one system is in place to an area where the other system is in place.
Posted by: ChrisA at Apr 4, 2007 10:04:50 AM
Actually a phenomenon that's bee studied. Here's a piece from The Economist:
http://www.econ.iastate.edu/classes/econ353/rksingh/sp05/news/SoundMoney.doc
Also, take a look at the book referenced there, The Big Problem of Small Change (Thomas Sargent and francis Velde).
http://www.amazon.com/Problem-Princeton-Economic-History-Western/dp/0691116350/ref=pd_bbs_sr_1/102-2145231-8744166?ie=UTF8&s=books&qid=1175696095&sr=8-1
Posted by: Donald A. Coffin at Apr 4, 2007 10:16:07 AM
Err, how about the idea that the banks make high charges to provide businesses with change?
Certainly true here in Portugal.
Posted by: Tim Worstall at Apr 4, 2007 10:29:53 AM
This is a big problem in Peru also. The ATMs dispense 100 sole notes (worth around $30), but, outside the major cities--and even at some places in cities--no one can will take them, pleading lack of change. I believe there is also a fear of counterfeit currency. So the "game" is to try to change the 100s asap and get the smallest bills possible in change. Unfortunately, everyone is trying to play the same game and the result is that tourists, who don't know the game, get stuck with money that is practically unspendable in the places they will go. The solution I've found is to change the large bills immediately at the teller in the bank where you used the ATM. You then have to walk around with a huge wad of small bills. But that beats starving or not being able to pay admission to a museum or archaeological site that you travelled hours to see.
Posted by: David at Apr 4, 2007 10:35:13 AM
ChrisA: After all - why would a shop keep lots of change if no-one ever asks for it, or a shopper keeps lots of bulky notes or heavy coins, if the shops are willing to take big note.
I live in the US, where change is happily given and stores keep plenty of small bills and coins on hand. Yet I personally hoard my small bills and coins quite fervently because my most frequent purchases are from vending machines that don't take anything larger than a buck.
I wonder how the prevalence of vending machines in places like Japan affect the behavior of shops and shoppers in holding small change.
Posted by: eddie at Apr 4, 2007 10:50:04 AM
Ben: If Italian stores have a very differentiated market from the worldwide cash register market (due to their unique receipt producing needs) this may reduce the Italian cash register market size and lead to a higher cost of production of italian style registers.
In my experience, cash registers in the US almost always print receipts for even the most trivial purchases. So I don't think the Italian cash register market is particularly unusual.
Posted by: eddie at Apr 4, 2007 10:54:33 AM
Ack. Sorry.
Posted by: eddie at Apr 4, 2007 10:55:12 AM
There's a similar phenomenon in the United Arab Emirates. Banks charge a premium for small bills.
Posted by: John B. Chilton at Apr 4, 2007 10:56:34 AM
Actually there's still a bit of this in play in Russia. Although by this point I think it's more of a cultural thing than actual necessity. Cashiers always want the closest thing to exact change, and if that can't be managed, they want you to pay in whichever manner means that they have to give you the fews number of coins or bills back.
I recall getting stared down/having a cashier mutter under her breath at me for not being able to pay for something down to the kopek at a gift shop. Since a kopek is worth about .03 *cents* it never made any sense for me to carry them around, and the fact that some prices are still listed in that way is even more ridiculous than us clinging to the penny in the US.
Posted by: James at Apr 4, 2007 3:36:07 PM
I think ChrisA has to be right.
I also think that countries that have ATM's with only high numbered bills probably have more of an issue, especially on payday and bank holidays. Also countries with former high inflation. No matter how you slice it whoever is holding cash is paying seignorage to the government, and is also missing out on interest (or something more sophisticated) by holding cash.
Finally, countries with high amounts of foreign tourists may wind up having those tourists leaving the country with lots of small change eat day. This means that everyone else, whether citizen or business, would tend to have less small change than otherwise without making bank trips.
Posted by: happyjuggler0 at Apr 4, 2007 6:25:08 PM
eat=each when I type while eating. Ha ha!
Posted by: happyjuggler0 at Apr 4, 2007 6:26:15 PM
Possibly a related anecdote... I have just recently gotten out of the retail world, but for 8 years I was always amazed at how unpopular 10$ bills and nickels were as compared to everything else. We would have to get far fewer of thoe denominations whenever we did "change runs" at the bank. People certainly used them far less often, but I wonder if there was something in the price structures that made them less usable?
Isaac
Posted by: Isaac Crawford at Apr 5, 2007 12:54:57 PM
A little off to the side of this topic, but an earlier comment brought it up so I thought I'd chime in: since college, when I waited tables for spending money, I've been amazed at the rarity with which I find myself in possession of more than one $10 bill. Even after a shift of waiting tables I'd be lucky to have two (and I made change for the customers myself).
Weird.
Posted by: Greg at Apr 6, 2007 4:25:07 PM
As a visitor in rural Italy, I found that they did not bother with small change like they do in the U.S. On several occasions, the merchants would round up!
Posted by: gmiller at Apr 6, 2007 11:07:45 PM
it´s bad in argentina. every corner shop has a sign saying "we don´t make change", which is really a problem when you need coins for the bus (it doesn´t accept bills). and if you have a $100 peso (the only thing the atm dispenses) prepare for a fight to get it changed.
on the other hand, maybe it´s smart on their part. i always end up buying extra snacks from the corner shops just to get change.
Posted by: jessica at Aug 3, 2007 3:49:16 PM
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Posted by: wslmwps at Aug 11, 2007 2:52:16 AM
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Posted by: wslmwps at Aug 14, 2007 3:59:59 AM
The shortage of coins and smaller denomination bills are a perenial problem in most shops here in Manila (Philippines). Smart shoppers who use debit or credit cards are few and rare. Credit cards are often used only for larger transactions (groceries, restaurants, hotels). Unlike in the U.S., personal checks are not considered legal tender for Over-the-counter purchases and are only used for paying bills and personal debts.
ATM Machines also dispense P500 Bills (US$12.31). Woe to the person who dares to shop armed with nothing but large denominations!
I always arm myself with sufficient amounts of coins and small bills whenever i shop for small items. I never use cash for big purchases. This is only because i am extremely "O.C." (Obsessive Compulsive) and like being organized. One tactic i employ when filling up my car with gas is to charge an odd amount (P740) instead of rounding off the purchase of gasoline to the nearest hundreds. This forces the poor gas station attendant to scrounge for change. That's how i manage to keep myself constantly supplied with small bills and coins. :@)
The "O.C." Shopper
Posted by: Mike at Mar 22, 2008 1:32:22 PM
The shortage of coins and smaller denomination bills are a perenial problem in most shops here in Manila (Philippines). Smart shoppers who use debit or credit cards are few and rare. Credit cards are often used only for larger transactions (groceries, restaurants, hotels). Unlike in the U.S., personal checks are not considered legal tender for Over-the-counter purchases and are only used for paying bills and personal debts.
ATM Machines also dispense P500 Bills (US$12.31). Woe to the person who dares to shop armed with nothing but large denominations!
I always arm myself with sufficient amounts of coins and small bills whenever i shop for small items. I never use cash for big purchases. This is only because i am extremely "O.C." (Obsessive Compulsive) and like being organized. One tactic i employ when filling up my car with gas is to charge an odd amount (P740) instead of rounding off the purchase of gasoline to the nearest hundreds. This forces the poor gas station attendant to scrounge for change. That's how i manage to keep myself constantly supplied with small bills and coins. :@)
The "O.C." Shopper
Posted by: Mike at Mar 22, 2008 1:32:25 PM
大家好，我是臺灣人，從臺灣一個人搬家來到美國，環境很陌生，感覺很孤單。以前在臺灣幾家知名的徵信社工作過，我是一個優秀的徵信工作者，希望早點找到適合自己的工作。希望通過貴站，認識更多的朋友。
Posted by: 謝文豪 at Apr 2, 2008 3:31:39 AM
