The Big Mac explains global economics June 7, 2008
Posted by Mark T. Market in Quotables.Tags: babysitter, Big Mac, caregiver, construction worker, domestic helper, economics, entertainer, Hong Kong, Hyperwage, Index, Japan, Minimum Wage, nurse, Saudi Arabia, Taiwan, Thads Bentulan, United Kingdom, United States
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Actually the Big Mac Index, popularized by The Economist, was a good study in Purchasing Power Parity between countries. Thads Bentulan, in his Hyperwage Theory, drew a third-dimension to the analysis, by putting Big Mac prices against the minimum wages of various countries, and drawing his own version of Purchasing Power Parity, measured in Big Macs.
I did my own simple version of Bentulan’s study, using readily available minimum wage data and big mac prices and compiled the following table:
The results are a fairly accurate projection of the economic standings of these countries. Seeing as minimum wage is a representation of the purchasing power of the majority of the economic agents in those countries, regardless of foreign exchange rates, indifference curves, and other economic mumbo jumbo, the Big Mac analysis gives us immediate insight of the ability of those countries to generate wealth and productivity for themselves.
No rocket science needed. Just an open mind.
Now, from that table, is it any surprise why there are a growing number of:
- Filipino Domestic Helpers in Hong Kong
- Filipino Entertainers in Japan
- Filipino Construction Workers in Saudi Arabia
- Filipino Caregivers in the UK
- Filipino Babysitters in Taiwan
- Filipino Nurses in the US
Being older than you (I am now 64 years) I may have the benefit of a longer hindsight so that I am better able to validate if indeed religion or belief in a supreme being does account for what has transpired in my life thus far. Like you perhaps I too at one time earlier in my life thought that I am solely responsible for my successes as well as failures and I too frowned at whiners blaming fate for their poor stations in life. You are what you are I maintained not because of some mysterious force over which you have no contol whether you call that religion or fate or god but because you chose it either by wrong decisions you took or because you simply did not make a decision at all. But I have at a later time in my life consciously and deliberately decided to believe in a God. I could have chosen to not believe but I guess if there is one decision I am happy to have taken
it is this. Now I can account for certain events in my life that I had no influence at all and some of it are wonderful events. Now I have a God to thank and ask for more favors.
[...] myself wrote about an economic concept known as Purchasing Power Parity (PPP) in my blog about the Big Mac Index. I’m requoting the study I did [...]