The Big Mac index: Our interactive currency comparison tool • Hacker News Board

Re: The Big Mac index: Our interactive currency comparison tool

#11

Post by refurb » Fri, Feb 04, 2022, 1:34 PM UTC

whoomp12342 wrote: post #5

The problem with the big mac index is that it assumes people still like mcdonalds.

Snide comment, but still a good point.

I assume that Macdonald's prices based on perceived value. If you go to Asia, McD’s has a much higher perceived value - and McD’s knows this and does multiple product launches every year, often catering to local tastes.

So I’d assume that consumers in the US or Europe don’t value a Big Mac the same was they do in Asia and as such the pricing differ (i.e. they can price higher in Asia).

Re: The Big Mac index: Our interactive currency comparison tool

#12

Post by throwaway22032 » Fri, Feb 04, 2022, 1:37 PM UTC

siva7 wrote: post #9

throwaway22032 wrote: post #3

Amusing that Russia has the world's cheapest Big Mac. Sorry Lenin, old chap.

It tastes the same as in US

Возможно лучше чем в Англии.

Or maybe I'm just used to the local one so all of the foreign big macs taste novel and interesting.

Re: The Big Mac index: Our interactive currency comparison tool

#13

Post by codingkev » Fri, Feb 04, 2022, 1:40 PM UTC

refurb wrote: post #11

whoomp12342 wrote: post #5

The problem with the big mac index is that it assumes people still like mcdonalds.

Snide comment, but still a good point. I assume that Macdonald's prices based on perceived value. If you go to Asia, McD’s has a much higher perceived value - and McD’s knows this and does multiple product launches every year, often catering to local tastes. So I’d assume that consumers in the US or Europe don’t value a Big Mac the same was they do in Asia and as such the pricing differ (i.e. they can price higher in…

True. In parts of Eastern Europe and in Asia, McDonalds is still considered a American premium-brand. Same goes for Starbucks and some other American chains.

Re: The Big Mac index: Our interactive currency comparison tool

#14

Post by petercooper » Fri, Feb 04, 2022, 1:41 PM UTC

I don't see how this really works any more because a Big Mac is different in different countries. It's not an "identical" product being compared.

You can use McDonald's own local nutrition calculators to confirm this. A Big Mac in the US is 550 calories, yet 508 calories in the UK (522 in Russia and a mere 498 in Switzerland, for comparison). Is it factored into the index that British fast food fans are getting 7.6% less burger as well as paying more than a US consumer?

Re: The Big Mac index: Our interactive currency comparison tool

#15

Post by MyHypatia » Fri, Feb 04, 2022, 1:41 PM UTC

bko wrote: post #7

I for one am shocked a Big Mac costs $5.81 in the United States. It's been too long I guess but I remember the meals going for $5-6 when I was a kid. And that's national average too, not an expensive metro area. Surely there were advances in production and logistics that would have lowered the "real" cost of McDonalds delivering a Big Mac, so all else being equal we would expect the price to drop over time. But monet…

Yes, I am surprised too. Especially when an In-n-Out Double Double costs $4.20 (this is in expensive California) and their burger has more meat. Plus In-n-out is notoriously generous with worker pay and benefits ($14 - $38 per hour, 401k benefits, health benefits, and paid holidays and vacation). I guess for McDonald's that extra money goes to advertising and executive pay?

Re: The Big Mac index: Our interactive currency comparison tool

#16

Post by mgkimsal » Fri, Feb 04, 2022, 1:41 PM UTC

nemo44x wrote: post #10

whoomp12342 wrote: post #5

The problem with the big mac index is that it assumes people still like mcdonalds.

Their stock and earnings would suggest they’re more popular than ever. Every time I drive past the one near me there’s a line of cars wrapped around it.

Are they not letting people inside? a couple around me still seem to be 'drive through only', which accounts for 'line of cars' I see, which... just seems like it's people sitting around wasting more gas idling. Maybe some McDonalds will convert to a 'drive-in' style, like sonic, with food runners...

Re: The Big Mac index: Our interactive currency comparison tool

#17

Post by eru » Fri, Feb 04, 2022, 1:42 PM UTC

bko wrote: post #7

I for one am shocked a Big Mac costs $5.81 in the United States. It's been too long I guess but I remember the meals going for $5-6 when I was a kid. And that's national average too, not an expensive metro area. Surely there were advances in production and logistics that would have lowered the "real" cost of McDonalds delivering a Big Mac, so all else being equal we would expect the price to drop over time. But monet…

> Surely there were advances in production and logistics that would have lowered the "real" cost of McDonalds delivering a Big Mac, so all else being equal we would expect the price to drop over time.

For that, you should look at number of minutes (or hours) the average person needs to work to afford a local Big Mac.

Wikipedia's entry on the Big Mac index says that https://web.archive.org/web/20080216015122/http://www.ubs.co... should provide this information. Or see https://www.statista.com/statistics/275235/big-mac-worldwide...

Re: The Big Mac index: Our interactive currency comparison tool

#18

Post by aphroz » Fri, Feb 04, 2022, 1:44 PM UTC

It's maybe 20% more expensive in Switzerland but it tastes better.

Re: The Big Mac index: Our interactive currency comparison tool

#19

Post by eru » Fri, Feb 04, 2022, 1:45 PM UTC

mgkimsal wrote: post #16

nemo44x wrote: post #10

Earlier quoted context omitted.

Their stock and earnings would suggest they’re more popular than ever. Every time I drive past the one near me there’s a line of cars wrapped around it.

Are they not letting people inside? a couple around me still seem to be 'drive through only', which accounts for 'line of cars' I see, which... just seems like it's people sitting around wasting more gas idling. Maybe some McDonalds will convert to a 'drive-in' style, like sonic, with food runners...

Where I live, there was a brief period in 2020 when they didn't let people inside McDonald's, but otherwise they have always allowed dine-in.

(However, I live in Singapore.)

Re: The Big Mac index: Our interactive currency comparison tool

#20

Post by moffkalast » Fri, Feb 04, 2022, 1:47 PM UTC

petercooper wrote: post #14

I don't see how this really works any more because a Big Mac is different in different countries. It's not an "identical" product being compared. You can use McDonald's own local nutrition calculators to confirm this. A Big Mac in the US is 550 calories, yet 508 calories in the UK (522 in Russia and a mere 498 in Switzerland, for comparison). Is it factored into the index that British fast food fans are getting 7.6%…

I think there's more to consider here too that makes it irrelevant in terms of currency comparison. Usually cheap stuff like bread is notoriously expensive in Switzerland for example, I'd assume because the price of labour is that high. As such the cost of making a big mac there is also more expensive, buying power is higher, so to meet demand and recoup labour costs the end prices are higher.

Same for the other extreme example in Turkey where workers are dirt cheap, and as such don't have much buying power or contribute that much to the overall burger cost, so the price is effectively lower.

This is just another standards of living map, it has barely anything to do with currency conversion. The Lira isn't undervalued, it's in a hyperinflation nosedive because of gross monetary mismanagement of Turkey lol.