How low can computers prices go? In the US, they've dipped below the $600 (#555) mark - which means they are hovering around the Irish equivalent of £425.

Curious, then, that the lowest price I could find for a computer in Ireland in the past two weeks was a £699 VAT-inclusive special from Dixon's, and a similar offer from CompuStore. It's not just the Republic, either - prices in Britain hover at a similar point and costs are typically higher in other European countries.

Why is this so? Why is the iMac, for example, available at more or less the same numerical figure in pounds over here as it would be in dollars in the US? Given the exchange rate, that means we're paying on average, 40 per cent more than the price of hardware in the US. Add on a crippling 17 per cent tax, and who wouldn't be wary of making a PC purchase here? The situation has worried the British government enough that earlier this year it decided to investigate why prices in general around Britain are often so out of kilter with those on the continent and the US (usually, items cost less across the channel, up to 30 per cent less for a pair of Levis, for example). And as we all know, prices on most items in the Republic tend to be even higher than those in the North or across the Irish Sea.

Because of the obvious price discrepancies, the British government is looking at whether industries and retailers are engaging in some form of price fixing. The same kinds of noises have been made here in the past - particularly about supermarket prices, especially when the retailer has shops on both sides of the Border, yet items are far dearer here. About every five years, a flurry of stories appear on the subject and nothing is done. So undoubtedly, many here will watch for the British government's conclusions with particular interest.

Prices of computers in Britain were one of the items highlighted in British newspaper coverage of price differentials late last year, which seem to have served as a prompt for the investigation. And computer prices should be a serious concern here as well. Any country which is trying to accelerate itself into the position of an information age economy cannot do so merely by offering support to industry to come into the digital fold, while leaving its population locked out.

We've all seen the statistics for the Republic, and any parent or teacher readily will confirm that with the exception of a handful of chosen institutions, schools are woefully under-equipped with computers or Internet access. The Republic in general has a very low installed base of PCs compared to many of its European neighbours, including those of similar size, such as Denmark.

Certainly, a greater commitment - financially and socially - to bringing technology into schools and homes is needed, rather than the occasional display-window gesture to highlight one project and imply that somehow, its effects will be felt in all corners of the State. But hand in hand with such a commitment must come a reduction in cost of the items which build a digital society - computers (and Internet access, but that's a separate topic).

Analysts point to rapidly falling prices in the US, and particularly, the advent of the very low cost PC, as major factors in the US's continuing strong lead in technology usage and awareness. Again and again, they have underlined the significance of computers priced below the $1,000 mark, and have placed the $500 price point as a major psychological and economic watermark.

Once prices hit the level of a hi-fi system or a good television, computers become "appliances" - items which become part of day-to-day life, and which are accessible to lower-income households, libraries and schools. This is the point at which an information age society becomes a possibility and not just an empty phrase for politicians and technologists.

At the moment, we are far from achieving those costs. We, too, should be questioning the high price of computers - at least, those sold by large manufacturers for considerably less in other parts of the world. And we should be demanding a change in the punishing tax on electronics, or at least, its application to computers, which adds nearly a fifth again to the price of hardware and keeps many potential buyers out of the market.

That tax is not helping retailers here, either - if you travel, why buy a laptop in Ireland when you can pick it up for a third of the cost just by walking into any American computer store? (Yes, you're supposed to declare it at customs, but if it's not still in its original box, how would anyone know when and where you bought it?)

As long as consumer computer costs remain high - and I would argue, artificially high - the Republic runs a significant risk of accelerating its industries into a high tech future while leaving the population at large out in the cold. That must not happen. With the nation's small size, and a roaring economy, we could - and should - be leading Europe in demonstrating how powerful a blend democracy, education, government and technology can be.

Karlin Lillington is at klillington@irish-times.ie