Friday, August 21, 2009

How many minutes to earn the price of a Big Mac?

This is an interesting take on the concept of Purchasing Power Parity by deploying a different angle on the famous Big Mac Index sourced from the Economist:

THE size of your pay packet may be important, but so is its purchasing power. Helpfully, a UBS report published this week offers a handy guide to how long it takes a worker on the average net wage to earn the price of a Big Mac in 73 cities. Fast-food junkies are best off in Chicago, Toronto and Tokyo, where it takes a mere 12 minutes at work to afford a Big Mac. By contrast, employees must toil for over two hours to earn enough for a burger fix in Mexico City, Jakarta and Nairobi.

AP

3 comments:

Anonymous said...

Why is Singapore mentioned but not Malaysia? This is too much. I notice that on Astro many overseas TV news do not include KLSE index in their reports. Also why Singapore is so on the spot as a balanced economic genius to be even slightly below average. Could you guesstimate Malaysia's cost which I believe to be very much above average. Thanks

de minimis said...

If the average hourly casual wage in Kuala Lumpur is RM5-00 (i.e. places like Starbucks, McDonalds, KFC, etc), then we can place KL at the 60+ mins range. This would be a fair guesstimate since the basis for calculation is "how long it takes a worker on the average net wage to earn the price of a Big Mac".

wankongyew said...

Actually the disparity should be greater than that shown on the chart. Big Macs are not the same everywhere. I know that the burgers that McDonalds sells in Europe is significantly bigger and of higher quality than those sold in Malaysia. I'd imagine that the portion sizes are even bigger in the US.