This, in particular, suggests that in Russia food is still cheaper than in America. Exactly so the national currency of the Russian Federation is undervalued against the dollar. By simple math actions, we get the difference of 70%. Now the burger in the USA costs $ 5.58, in Russia – $ 1.68. The current level of Big Mac Index against the rubleĪs of mid-January 2019, Big Mac index shows that the revaluation of the dollar has peaked in the last 30 years. Of course, these are approximate values, since real data depends on the specific price of the dish.
Thus, a dollar is 40 times more valuable than a ruble. If we imagine that in Russia for a burger they give 200 rubles, and in the USA – 5 dollars, then when divided, the difference will be 40. The index is calculated as follows: the price of Big Mac in two countries with different currencies is compared to each other. It also includes the cost of renting the building, output, salaries and the price of products, which serves as additional factors for objectivity. Second, the components of a burger (bread, meat, cheese and vegetables) are universal in their need for the life of an ordinary person. As of 2019, the network is not represented in just 9 countries. First, Mc’Donalds restaurants are practically in the whole world. Well-known dish as an example is not just. It demonstrates whether the fair value of a single currency is fair.
For the first time it was a comic action, but then the indicator’s solidity became obvious. What is Big Mac Index, why exactly the burger and what the indicator shows?Įvery year the financial publication The Economist publishes the Big Mac Index. According to the latest indicators of the index, the ruble is the most undervalued currency. He determines the ratio of the exchange rate through the prism of the cost of the food basket, in this case, a burger from the popular fast food chain Mc’Donalds. However, they also play an important role in understanding what is happening. In addition to the obviously influential indices that determine the level of the financial economy (for example, Dow Jones), there are externally comical ones. “The wage increase in 2015 - to be a $1 above the local minimum wage - was applicable to the local wages on July 1, 2015, but was not a policy thereafter,” the fast food chain said in a statement.Big Mac Index is a universal tool for assessing the correlation of currencies and purchasing power of people. As a result, the company said, they would make an average of $10 an hour.īut three years later, Fight for 15 accused McDonald’s of lying to workers and released pay stubs showing that workers in eight different cities were making between 40 and 70 cents above their local minimum. In April 2015, McDonald’s announced that it would implement a wage increase for 90,000 workers at its 1,500 company-owned restaurants in the U.S the chain said that as of 1 July of that year, employees would earn at least $1 more than the local minimum wage. We contacted McDonald’s seeking comment, but the restaurant chain has yet to respond. Web sites like and, which aggregate companies’ salary information, reported that the average salary for a McDonald’s employee is around $9 per hour. Department of Labor, 29 states currently have minimum wages higher than the federal standard of $7.25 an hour.
For its part, the Australian government’s Fair Work Ombudsman states that the minimum wage there is $18.29 Australian, equivalent to $13.64 American dollars.Īccording to the U.S. However, a French government states on its web site that the country’s minimum wage is 9.88 Euro, equivalent to $11.71 U.S. The group also based its findings on a Wikipedia page listing minimum wages in 193 countries. Fight for 15, which has campaigned for the company to both institute a minimum wage of $15 per hour across the board and allow workers to unionize, also noted that it based its Big Mac prices on the “Big Mac index,” a currency-comparison guide published by The Economist compiling average prices for the burger at McDonald’s locations in various countries to “make exchange-rate theory more digestible” for readers.
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