All twenty-seven nations of the EU are members of the single market. Seventeen countries have entered the Euro Area and share a common currency. Under EU law, as an EU national, you cannot be charged a higher price than local residents when buying products or services anywhere else in the EU, unless the price difference is justified.

Price convergence shows the degree to which prices for goods and services in European Union Member States have moved together, or converged, and is an important indicator of the success of the internal market.

In contrast, price divergence shows the degree to which prices have moved apart. It is calculated by examining the coefficient of variation of the comparative price levels. The lower the coefficient, the greater is price convergence within the EU

Our Timetric chart tracks what has happened to comparative prices within the EU over the years. We see a gradual process of price convergence but there remain widespread and persistent price differences across Europe for similar / standardised products - from petrol to hotel rooms, from clothing to a meal out. I ask students if they can explain some of these price differences and if they can use cost and revenue curve analysis to illustrate them?

Data from Timetric.

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Eurostat: the EU’s Statistical Service from Timetric