Junk Bonds

August 21, 2009

Interesting story in The Times yesterday, using the Big Mac as a new index of earning power.

Tokyo workers have to spend only 12 minutes at their desks before they can buy a Big Mac for lunch, while their counterparts in Nairobi, the Kenyan capital, have to work for more than two and a half hours.

Nairobi was certainly getting more expensive while I lived and worked there, but this stat is clearly more about the poor incomes of Kenyans rather than the relative expense of visiting McDonald’s. Particularly as the price of a Big Mac would have to factor in the cost of an airfare to a city which actually has a McDonald’s, Nairobi still apparently being too dangerous for America’s most famous junk food retailer….



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2 thoughts on “Junk Bonds”

  1. Hmm, interesting, thanks for sharing this Rob. It’s good to see journalists making that kind of comparison.
    But actually I’m sure it’s much worse than that. The Times piece makes it seem as if Kenyans frequently go out for a burger when in fact most people have no paid employment at all, and will never go to a takeaway.
    They’re missing so much of course. . . but you take my point.
    Richard
    Incidentally, the idea that the average Japanese burger-eater is earning only 12.5 x the average Kenyan (or maybe Nairobian) makes things seem a lot less troubling than they are. The £2 Big Mac, or equivalent, is probably going to take most Kenyans who have jobs a day or more to earn, not 2.5hrs.

  2. Rob Crilly says:

    Yes, it certainly shows the limitations of using the arithmetic mean to measure life in a country like Kenya where there is such a massive difference between rich and poor. The presence of a small elite and a growing middle class hides the true poverty that most people experience when you are just considering this particular measure

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