How long to earn a Big Mac?

[Peter Miami 0]

How long to earn a Big Mac?

Swiss bank releases its ranking of the costs of living worldwide, this time with a little spin: How long does a local have to work to earn enough to buy a tasty American icon?

By The Associated Press

Residents of Tokyo have the highest purchasing power in the world, edging out people in Los Angeles, Sydney, London and Toronto, according to a new survey by the Swiss banking giant UBS that uses the "Big Mac" as its benchmark.

Tokyo scored at the top of the survey, which aims to eliminate variables such as exchange rates, even though it is one of the most expensive cities in the world, UBS said in the "Prices and Earnings" report released Wednesday.

"Wages only become meaningful in relation to prices -- that is, what can be bought with the money earned," it said.

The bank calculated the "weighted net hourly wage in 14 professions" and divided it into the local price of "a globally available product," for which it chose McDonald's flagship hamburger.

"On a global average, 35 minutes of work buys a Big Mac," it said. "But the disparities are huge: in Nairobi, 1.5 hours' work is needed to buy the burger with the net hourly wage there. In the U.S. cities of Los Angeles, New York, Chicago and Miami, a maximum of 13 minutes' labor is needed."

In Tokyo, it takes a mere 10 minutes. Bogota, Colombia, came in last among the 70 cities surveyed at 97 minutes.

Oslo world's costliest city

The UBS survey, conducted every three years, rated Oslo as the most expensive city on the basis of the cost of a basket of 122 goods and services, excluding rent. It was followed by London; Copenhagen, Denmark; Zurich, Switzerland; Tokyo; Geneva; New York; Dublin, Ireland; Stockholm, Sweden; and Helsinki, Finland.

The least expensive cities were Manila, Philippines; Delhi; Buenos Aires; Bombay and Kuala Lumpur.

UBS said that if the cost of housing was included, "life is particularly expensive in London and New York."

The bank also compared wages. In that contest Copenhagen was tops, with an index of 118.2. For that comparison, New York -- in fifth place -- was taken as the base with an index of 100. Second place went to Oslo, followed by Zurich and Geneva. London was in sixth, followed by Chicago, Dublin, Frankfurt and Brussels.

At the other end was Delhi, with an index of 6.1.

"In the cities of Western Europe and North America, workers in 14 representative professions earn a gross hourly wage averaging US$18 (euro14); in the Eastern European and Asian cities examined, the figure was only US$4-US$5 (euro3.10-euro3.90)."

But taxes and social security payments take a big bit in northern Europe, with Scandinavian and German cities losing ground.

Wages high, standards high in U.S.

Rankings were similar to the last survey in 2003, with changes resulting largely from shifts in foreign exchange rates, the study said. New York and Chicago dropped in the expensive cities ranking, mostly due to the weaker dollar.

"Shanghai and Beijing, meanwhile, remain comparatively inexpensive despite an economic boom because the national currency, the renminbi, has so far resisted pressures to appreciate."

Workers in Seoul, South Korea, work the longest. Those in Paris have the shortest work week.

"Based on a 42-hour work week, Asian workers labor about 50 days a year more than their peers in Paris," it said.

The study said a dollar earned in Los Angeles, after deducting taxes and Social Security contributions, is worth more than in Chicago, New York, Miami, Toronto and Montreal.

"Although the highest wages are paid in New York, it also has the highest cost of living anywhere in the Americas," it said. "Thanks to their much higher wages, after buying the basic basket of goods and services, workers in North American cities have far more left over for vacations, luxury items or savings than their counterparts in Latin America. The average purchasing power in Central and South America is just a third of the level in the North American cities."

How long to earn a Big Mac?

City Min. City Min. City Min.

Tokyo 10 Nicosia, Cyprus 19 Prague, Czech Republic 39

Los Angeles 11 Brussels, Belgium 20 Tallinn, Estonia 39

Chicago 12 Milan, Italy 20 Warsaw, Poland 43

Miami 12 Taipei, Taiwan 20 Vilnius, Lithuania 43

New York 13 Barcelona, Spain 21 Beijing 44

Auckland, New Zealand 14 Paris 21 Budapest, Hungary 48

Sydney, Australia 14 Stockholm, Sweden 21 Istanbul, Turkey 48

Toronto 14 Singapore 22 Rio de Janeiro, Brazil 53

Dublin, Ireland 15 Lyon, France 24 Bratislava, Slovakia 55

Zurich, Switzerland 15 Manama, Bahrain 24 Santiago, Chile 56

Frankfurt, Germany 16 Dubai, United Arab Emirates 25 Kiev, Ukraine 56

Geneva 16 Moscow 25 Buenos Aires, Argentina 56

London 16 Rome 25 New Delhi 59

Vienna, Austria 16 Athens, Greece 26 Bangkok, Thailand 67

Berlin 17 Riga, Latvia 28 Bucharest, Romania 69

Hong Kong 17 Seoul, South Korea 29 Sofia, Bulgaria 69

Luxembourg 17 Johannesburg, South Africa 30 Bombay, India 70

Montreal 17 Lisbon, Portugal 32 Manila, Philippines 81

Munich, Germany 17 Kuala Lumpur, Malaysia 33 Mexico City 82

Copenhagen, Denmark 18 Ljubljana, Slovenia 35 Caracas, Venezuela 85

Oslo, Norway 18 Worldwide average 35 Jakarta, Indonesia 86

Amsterdam, Netherlands 19 Sao Paulo, Brazil 38 Lima, Peru 86

Helsinki, Finland 19 Shanghai, China 38 Nairobi, Kenya 91

Madrid, Switzerland 19 Bogota, Colombia 97

If you want to read the article, the link is; http://articles.moneycentral.msn.com/News/...uyingPower.aspx

Regards,

Peter Miami

[Nessa 23]

Interesting.

[Hilarious Clinton 452]

Big mac index.

"The Big Mac index is an informal way of measuring the purchasing power parity (PPP) between two currencies and provides a test of the extent to which market exchange rates result in goods costing the same in different countries"

http://en.wikipedia.org/wiki/Big_Mac_index

[Jenn! 918]

I think a "loaf of bread" or " head of cabbage" index would be more useful. There are too many societal factors that would contribute to the value of a Big Mac.

[Hilarious Clinton 452]

I think a "loaf of bread" or " head of cabbage" index would be more useful. There are too many societal factors that would contribute to the value of a Big Mac.

Just the opposite. McDonalds has turned cooking and selling a hamburger into a finite science.

[MrMrsKnight 0]

Brazil 53

Guess what I'm gonna be doing in an hour?

[Jenn! 918]

I think a "loaf of bread" or " head of cabbage" index would be more useful. There are too many societal factors that would contribute to the value of a Big Mac.

Just the opposite. McDonalds has turned cooking and selling a hamburger into a finite science.

But let's compare, say, the U.S. and Morocco. In the U.S., a Big Mac is a normal good at low incomes, but an inferior good at high incomes, while in Morocco, I'm guessing that a Big Mac is a normal good at all income levels. That is to say, using average incomes in the U.S. to calculate the Big Mac index will give you an inflated representation of the value of the Big Mac when compared to the value of a Big Mac in Morocco, no?

[Reba 2]

well, even in different parts of Toronto the price of a Big Mac changes.

I remember about 15 or so years ago when I was being considered for a receptionist position for a US parented company. The Canadian office submitted paperwork for my suggested salary, and the US head office was saying "no way! we don't pay the receptionist here that much" but then they did the Big Mac comparrison and figured out that the cost of living (or rather the Big Mac cost) was higher in Toronto than it was in Littleton Colorado.

They used the Big Mac index for years to figure out salaries around the world. At least once a year the head bean counter in Littleton would call every office and ask them what the price of a Big Mac was currently. I'd tell them what it was at the McD's down the road from the office, and how much it was at the Sky Dome, which was the most expensive Big Mac in the city

[Peter Miami 0]

Brazil 53

Guess what I'm gonna be doing in an hour?

LOL!

I will join you but it only takes us in Miami 12 minutes in order to buy one.

Peter Miami

[Hilarious Clinton 452]

I think a "loaf of bread" or " head of cabbage" index would be more useful. There are too many societal factors that would contribute to the value of a Big Mac.

Just the opposite. McDonalds has turned cooking and selling a hamburger into a finite science.

But let's compare, say, the U.S. and Morocco. In the U.S., a Big Mac is a normal good at low incomes, but an inferior good at high incomes, while in Morocco, I'm guessing that a Big Mac is a normal good at all income levels. That is to say, using average incomes in the U.S. to calculate the Big Mac index will give you an inflated representation of the value of the Big Mac when compared to the value of a Big Mac in Morocco, no?

Not a perfect system. But McDonalds will price the Big Mac to maximize profit (which is really sales because they work on volume). I didn't invent the Big Mac index. The 'Economist" did.

http://www.economist.com/markets/Bigmac/Index.cfm

[jordanianprincess 0]

I have no idea but now I want a big mac damn....

[iceyspots 0]

I think a "loaf of bread" or " head of cabbage" index would be more useful. There are too many societal factors that would contribute to the value of a Big Mac.

Just the opposite. McDonalds has turned cooking and selling a hamburger into a finite science.

But let's compare, say, the U.S. and Morocco. In the U.S., a Big Mac is a normal good at low incomes, but an inferior good at high incomes, while in Morocco, I'm guessing that a Big Mac is a normal good at all income levels. That is to say, using average incomes in the U.S. to calculate the Big Mac index will give you an inflated representation of the value of the Big Mac when compared to the value of a Big Mac in Morocco, no?

Depends on whether it's halal or not........

[Bosco 1]

How much does a Big Mac cost?

[jordanianprincess 0]

3 bucks?

[Jenn! 918]

I think a "loaf of bread" or " head of cabbage" index would be more useful. There are too many societal factors that would contribute to the value of a Big Mac.

Just the opposite. McDonalds has turned cooking and selling a hamburger into a finite science.

But let's compare, say, the U.S. and Morocco. In the U.S., a Big Mac is a normal good at low incomes, but an inferior good at high incomes, while in Morocco, I'm guessing that a Big Mac is a normal good at all income levels. That is to say, using average incomes in the U.S. to calculate the Big Mac index will give you an inflated representation of the value of the Big Mac when compared to the value of a Big Mac in Morocco, no?

Not a perfect system. But McDonalds will price the Big Mac to maximize profit (which is really sales because they work on volume). I didn't invent the Big Mac index. The 'Economist" did.

http://www.economist.com/markets/Bigmac/Index.cfm

I suppose the Economist knows more than me about economics, so I'll trust them on this one...