The Big Mac Index: A Measure of Purchasing Power Parity
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The Big Mac Index: A Measure of Purchasing Power Parity & Burger Inflation

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The Big Mac Index: A Measure of PPP and Burger Inflation

The Big Mac was created in 1967 by Jim Delligati, a McDonald’s franchise owner in Pennsylvania. It was launched throughout the U.S. the following year, and today you can buy one in more than 70 countries. However, the price you pay will vary based on where you are, as evidenced by the Big Mac Index.

Spanning from 2004-2022, this animation from James Eagle shows the U.S. dollar price of a Big Mac in select countries around the world.

What Does the Big Mac Index Show?

The Big Mac Index was invented by The Economist in 1986. It is intended to be a lighthearted way to demonstrate the concept of purchasing power parity. In other words, it helps illustrate the idea that market exchange rates between countries may be “out of whack” when compared to the cost of buying the same basket of goods and services in those places.

Given that McDonald’s is one of the biggest companies in the world and the Big Mac is widely available globally, it means that the famous burger can be used as a basic goods comparison between most countries. It also has the advantage of having the same inputs and distribution system, with a few minor modifications (like chicken patties in India instead of beef).

Using the price of a Big Mac in two countries, the index can give an indication as to whether a currency may be over or undervalued. For example, a Big Mac costs ¥24.40 in China and $5.81 in the United States. By comparing the implied exchange rate to the actual exchange rate, we can see whether the Yuan is over or undervalued.

big mac index math

According to the Big Mac Index, the Yuan is undervalued by 34%.

Beyond currency misalignment, the index has other uses. For instance, it shows inflation in burger prices over time. If we compare the price of a Big Mac across countries in the same currency—such as the U.S. dollar—we are also able to see where burgers are cheaper or relatively more expensive.

Burger Costs Around the World

In the animation, all Big Mac prices have been converted from local currency to U.S. dollars based on the actual exchange rate in effect at the time. Below, we show the change in price of a Big Mac in select countries, ordered by January 2022 prices.

CountryMay 2004January 2022% change
Switzerland$4.88$6.9843%
Norway$5.18$6.3923%
United States$2.90$5.81100%
Sweden$3.94$5.7947%
Israel$2.79$5.3592%
Canada$2.33$5.32129%
Venezuela$1.48$5.06243%
Euro area$3.29$4.9551%
Denmark$4.46$4.828%
Britain$3.37$4.8243%
New Zealand$2.65$4.6073%
Australia$2.27$4.5198%
Singapore$1.93$4.36126%
Brazil$1.70$4.31154%
Argentina$1.48$4.29190%
Sri Lanka$1.41$4.15193%
Czech Republic$2.13$4.1193%
Chile$2.18$3.8878%
Thailand$1.45$3.84166%
China$1.26$3.83205%
South Korea$2.72$3.8240%
Poland$1.63$3.44111%
Japan$2.32$3.3846%
Peru$2.58$3.3631%
Mexico$2.07$3.3462%
Hungary$2.51$3.0923%
Hong Kong$1.54$2.8283%
Philippines$1.23$2.79126%
Taiwan$2.25$2.7020%
South Africa$1.86$2.5839%
Ukraine$1.36$2.4379%
Malaysia$1.33$2.3980%
Indonesia$1.77$2.3634%
Turkey$2.58$1.86-28%
Russia$1.45$1.7420%

Switzerland takes the cake for the priciest Big Mac, followed closely behind by Norway. Both countries have relatively high price levels but also enjoy higher wages when compared to other OECD countries.

Venezuela has seen the largest jump in burger prices, with the cost of a Big Mac climbing nearly 250% since 2004. The country has been plagued by hyperinflation for years, so it’s no surprise to see large price swings in the country’s data.

While it appears that the price of a Big Mac has decreased in Turkey, this is because the prices are shown in U.S. dollars. The new Turkish lira has depreciated against the U.S. dollar more than 90% since it was introduced in 2005.

Finally, it’s worth noting that Russia has the cheapest Big Mac, reflecting the country’s lower price levels. Labor costs in Russia are roughly a third of those in Switzerland.

The Limitations of Burgernomics

The Big Mac Index is useful for a number of reasons. Investors can use it to measure inflation over time, and compare this to official records. This can help them value bonds and other securities that are sensitive to inflation. The Big Mac Index also indicates whether a currency may be over or undervalued, and investors can place foreign exchange trades accordingly.

Of course, the index does have shortcomings. Here are some that economists have noted.

  • Non-traded services can have different prices across countries. The price of a Big Mac will be influenced by the costs of things like labor, but this is not a reflection of relative currency values. The Economist now releases a GDP-adjusted version of the Big Mac Index to help address this criticism.
  • McDonald’s is not in every country in the world. This means the geographic reach of the Big Mac Index has some limitations, particularly in Africa.
  • The index lacks diversity. The index is made up of one item: the Big Mac. Because of this, it lacks the diversity of other economic metrics such as the Consumer Price Index.

Despite all of these limitations, the Big Mac Index does act as a good starting place for understanding purchasing power parity. Through the simplicity of burgers, complex economic theory is easier to digest.

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This article was published as a part of Visual Capitalist's Creator Program, which features data-driven visuals from some of our favorite Creators around the world.

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Mapped: The World’s Billionaire Population, by Country

Collectively, worldwide billionaire wealth is nearly $12 trillion. This map breaks down where these 3,311 billionaires live around the globe.

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Visualized: The World’s Billionaire Population

The world’s billionaires—only 3,311 individuals—represent almost $11.8 trillion in wealth. The global billionaire population continued to grow in 2021, increasing by 3%. Over the same period, billionaire wealth also increased by 18%.

This map uses data from the Wealth-X Billionaire Census to visualize where the world’s billionaires live and breaks down their collective wealth.

Note on methodology: The report uses proprietary data from Wealth-X. Billionaire status is determined by assessing an individual’s total net worth, including publicly and privately held businesses and investable assets. To determine a billionaire’s location, Wealth-X used their primary business address.

Billionaires by Region

We’ll begin by zooming out to look at how various continents and world regions rank in terms of their billionaire population.

North America is home to most billionaires, worth $4.6 trillion. The U.S., unsurprisingly, accounts for the majority of this wealth, with 975 billionaires and a collective net worth of $4.45 trillion.

RankRegionNumber of billionairesCollective Billionaire Wealth
#1North America1,035$4.6 trillion
#2Europe954$3.1 trillion
#3Asia899$2.9 trillion
#4Middle East191$519 billion
#5Latin America and the Caribbean146$465 billion
#6Africa46$104 billion
#7Pacific40$89 billion

In regional terms, Europe’s billionaire wealth is growing the fastest, up 22% year-over-year in 2021. In contrast, the year-over-year change in the Middle East was -12.5%.

Asia is inching towards Europe, holding almost a quarter of all billionaire wealth worldwide, compared to Europe’s 26.5%.

Wealth in Africa will also be important to watch in coming years. Although only home to 46 billionaires currently, the change in billionaire wealth increased by almost 17% year-over-year. Additionally, while they no longer live there, a number of the world’s billionaires hail from African countries originally.

Billionaires by Country

Now, let’s look at the ranking broken down by the top 15 countries:

RankCountryNumber of BillionairesCollective Billionaire Wealth
#1🇺🇸 US975$4.45 trillion
#2🇨🇳 China400$1.45 trillion
#3🇩🇪 Germany176$602 billion
#4🇮🇳 India124$384 billion
#5🇬🇧 UK120$266 billion
#6🇭🇰 Hong Kong SAR114$287 billion
#7🇨🇭 Switzerland111$365 billion
#8🇷🇺 Russia107$475 billion
#9🇸🇦 Saudi Arabia71$192 billion
#10🇫🇷 France68$294 billion
#11🇮🇹 Italy68$207 billion
#12🇨🇦 Canada60$131 billion
#13🇧🇷 Brazil52$159 billion
#14🇸🇬 Singapore50$99 billion
#15🇦🇪 UAE45$181 billion

China is an obvious second in billionaire wealth to the United States, with famous billionaires like Zhang Yiming ($44.5 billion) of TikTok and Zhong Shanshan ($67.1 billion), whose wealth primarily comes from the pharmaceutical and beverages industries.

That said, Chinese billionaire wealth actually decreased 2% last year. It was India that came out on top in terms of growth, seeing a 19% increase in 2021.

Billionaires by City

Looking at cities, New York is home to the most billionaires—with 13 added billionaire residents last year—followed by Hong Kong.

RankCityCountryNumber of Billionaires
#1New York City🇺🇸 U.S.138
#2Hong Kong🇭🇰 China114
#3San Francisco🇺🇸 U.S.85
#4London🇬🇧 UK77
#5Moscow🇷🇺 Russia75
#6Beijing🇨🇳 China63
#7Los Angeles🇺🇸 U.S.59
#8Singapore🇸🇬 Singapore50
#9Shenzhen🇨🇳 China44
#10Mumbai🇮🇳 India40
#11Dubai🇦🇪 UAE38
#12Hangzhou🇨🇳 China35
#13São Paulo🇧🇷 Brazil34
#14Istanbul🇹🇷 Turkey33
#15Paris🇫🇷 France33

Billionaire Wealth in 2022

Billionaires have significant power and influence, not in the least because their collective wealth is equivalent to about 11.8% of global GDP.

In recent billionaire news, Gautam Adani’s wealth has been soaring, most recently hitting the $145 billion mark, making him the third-richest person in the world according to Bloomberg’s Billionaire Index. However, not all billionaires are holding on to their wealth. Patagonia founder, Yvon Chouinard, recently transferred ownership of his company to an organization that fights climate change.

Over the last decade, billionaires have been grown their fortunes considerably, with wealth increasing at a faster rate than the growth in the number of billionaires themselves. According to Wealth-X, collective billionaire net worth grew by an astonishing 90% in the last 10 years.

But in the shorter term, the situation is often more volatile. With markets reeling in 2022, Bloomberg reported that billionaires lost a record $1.4 trillion over the first half of the year. Once the year is over and the final numbers are in, it will be interesting to see how the billionaire landscape shapes up in comparison to the more long-term trend.

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Charting the Relationship Between Wealth and Happiness, by Country

Can money really buy happiness? In this chart, we compare most of the world’s countries to examine the relationship between wealth and happiness.

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wealth and happiness

The Relationship Between Wealth and Happiness, by Country

Throughout history, the pursuit of happiness has been a preoccupation of humankind.

Of course, we humans are not just content with measuring our own happiness, but also our happiness in relation to the people around us—and even other people around the world. The annual World Happiness Report, which uses global survey data to report how people evaluate their own lives in more than 150 countries, helps us do just that.

The factors that contribute to happiness are as subjective and specific as the billions of humans they influence, but there are a few that have continued to resonate over time. Family. Love. Purpose. Wealth. The first three examples are tough to measure, but the latter can be analyzed in a data-driven way.

Does money really buy happiness? Let’s find out.

Wealth and Happiness

To crunch the numbers, we looked at data from Credit Suisse, which breaks down the average wealth per adult in various countries around the world.

The table below looks at 146 countries by their happiness score and wealth per adult:

CountryMedian Wealth per Adult (US$)Happiness Score
🇫🇮 Finland 73,7757.8
🇩🇰 Denmark 165,6227.6
🇮🇸 Iceland 231,4627.6
🇨🇭 Switzerland 146,7337.5
🇮🇱 Israel 80,3157.4
🇸🇪 Sweden 89,8467.4
🇳🇴 Norway 117,7987.4
🇳🇱 Netherlands 136,1057.4
🇱🇺 Luxembourg 259,8997.4
🇦🇹 Austria 91,8337.2
🇳🇿 New Zealand 171,6247.2
🇦🇺 Australia 238,0727.2
🇩🇪 Germany 65,3747.0
🇺🇸 United States 79,2747.0
🇮🇪 Ireland 99,0287.0
🇨🇦 Canada 125,6887.0
🇨🇿 Czech Republic 23,7946.9
🇬🇧 United Kingdom 131,5226.9
🇧🇪 Belgium 230,5486.8
🇫🇷 France 133,5596.7
🇧🇭 Bahrain 14,5206.6
🇨🇷 Costa Rica 14,6626.6
🇦🇪 United Arab Emirates 21,6136.6
🇸🇮 Slovenia 67,9616.6
🇸🇦 Saudi Arabia 15,4956.5
🇺🇾 Uruguay 22,0886.5
🇷🇴 Romania 23,6756.5
🇽🇰 Kosovo 46,0876.5
🇸🇬 Singapore 86,7176.5
🇹🇼 Taiwan 93,0446.5
🇪🇸 Spain 105,8316.5
🇮🇹 Italy 118,8856.5
🇱🇹 Lithuania 29,6796.4
🇸🇰 Slovakia 45,8536.4
🇶🇦 Qatar 83,6806.4
🇲🇹 Malta 84,3906.4
🇧🇷 Brazil 3,4696.3
🇵🇦 Panama 13,1476.3
🇬🇹 Guatemala 30,5866.3
🇪🇪 Estonia 38,9016.3
🇳🇮 Nicaragua 3,6946.2
🇰🇿 Kazakhstan 12,0296.2
🇷🇸 Serbia 14,9546.2
🇨🇱 Chile 17,7476.2
🇱🇻 Latvia 33,8846.2
🇨🇾 Cyprus 35,3006.2
🇺🇿 Uzbekistan 7,8216.1
🇸🇻 El Salvador 11,3726.1
🇲🇽 Mexico 13,7526.1
🇵🇱 Poland 23,5506.1
🇭🇺 Hungary 24,1266.1
🇲🇺 Mauritius 27,4566.1
🇰🇼 Kuwait 28,6986.1
🇭🇷 Croatia 34,9456.1
🇦🇷 Argentina 2,1576.0
🇭🇳 Honduras 15,3806.0
🇵🇹 Portugal 61,3066.0
🇯🇵 Japan 122,9806.0
🇵🇭 Philippines 3,1555.9
🇯🇲 Jamaica 5,9765.9
🇲🇩 Moldova 7,5775.9
🇹🇭 Thailand 8,0365.9
🇬🇷 Greece 57,5955.9
🇰🇷 South Korea 89,6715.9
🇰🇬 Kyrgyzstan 2,2385.8
🇲🇳 Mongolia 2,5465.8
🇨🇴 Colombia 4,8545.8
🇧🇾 Belarus 12,1685.8
🇧🇦 Bosnia and Herzegovina 15,2835.8
🇲🇾 Malaysia 8,5835.7
🇩🇴 Dominican Republic 22,7015.7
🇵🇾 Paraguay 3,6445.6
🇧🇴 Bolivia 3,8045.6
🇵🇪 Peru 5,4455.6
🇨🇳 China 24,0675.6
🇻🇳 Vietnam 4,5595.5
🇷🇺 Russia 5,4315.5
🇪🇨 Ecuador 5,4445.5
🇹🇲 Turkmenistan 9,0305.5
🇲🇪 Montenegro 30,7395.5
🇳🇵 Nepal 1,4375.4
🇹🇯 Tajikistan 1,8445.4
🇦🇲 Armenia 9,4115.4
🇧🇬 Bulgaria 17,4035.4
🇭🇰 Hong Kong  SAR173,7685.4
🇱🇾 Libya 6,5125.3
🇧🇩 Bangladesh 3,0625.2
🇿🇦 South Africa 4,5235.2
🇮🇩 Indonesia 4,6935.2
🇦🇿 Azerbaijan 5,0225.2
🇨🇮 Côte d'Ivoire6,6215.2
🇦🇱 Albania 15,3635.2
🇲🇰 North Macedonia 51,7885.2
🇬🇲 The Gambia6585.2
🇱🇷 Liberia 1,4645.1
🇱🇦 Laos 1,6105.1
🇩🇿 Algeria 2,3025.1
🇺🇦 Ukraine 2,5295.1
🇲🇦 Morocco 3,8745.1
🇨🇬 Congo 5825.1
🇸🇳 Senegal 1,5705.0
🇬🇪 Georgia 4,2235.0
🇬🇦 Gabon 4,6855.0
🇲🇿 Mozambique 3455.0
🇳🇪 Niger 4925.0
🇨🇲 Cameroon 9415.0
🇬🇭 Ghana 2,1984.9
🇮🇶 Iraq 6,3784.9
🇻🇪 Venezuela 7,3414.9
🇮🇷 Iran 7,6214.9
🇬🇳 Guinea 9384.9
🇹🇷 Turkey 8,0014.7
🇧🇫 Burkina Faso 6224.7
🇰🇲 Comoros 1,4664.6
🇳🇬 Nigeria 1,4744.6
🇰🇭 Cambodia 2,0314.6
🇺🇬 Uganda 6464.6
🇧🇯 Benin 8904.6
🇵🇰 Pakistan 2,1874.5
🇳🇦 Namibia 3,6774.5
🇰🇪 Kenya 3,6834.5
🇹🇳 Tunisia 6,1774.5
🇲🇱 Mali 8694.5
🇲🇲 Myanmar 2,4584.4
🇱🇰 Sri Lanka 8,8024.4
🇨🇩 DR Congo3564.4
🇪🇬 Egypt 6,3294.3
🇹🇩 Chad 3554.3
🇲🇬 Madagascar 6664.3
🇲🇷 Mauritania 1,0374.2
🇾🇪 Yemen 1,2234.2
🇪🇹 Ethiopia 1,5274.2
🇯🇴 Jordan 10,8424.2
🇹🇬 Togo 4684.1
🇮🇳 India 3,1943.8
🇲🇼 Malawi 6063.8
🇿🇲 Zambia 6923.8
🇹🇿 Tanzania 1,4333.7
🇭🇹 Haiti1933.6
🇸🇱 Sierra Leone 3703.6
🇧🇼 Botswana 3,6803.5
🇱🇸 Lesotho 2643.5
🇷🇼 Rwanda 1,2663.3
🇱🇧 Lebanon 18,1593.0
🇸🇸 South Sudan 2,6772.9
🇦🇫 Afghanistan 7342.4

While the results don’t definitively point to wealth contributing to happiness, there is a strong correlation across the board. Broadly speaking, the world’s poorest countries have the lowest happiness scores, and the richest report being the most happy.

Regional and Country-Level Observations

While many of the countries follow an obvious trend (more wealth = more happiness), there are nuances and outliers worth exploring.

  • In Latin America, people self-report more happiness than the trend between wealth and happiness would predict.
  • On the flip side, many nations in the Middle East report slightly less happiness than levels of wealth would predict.
  • Political turmoil, an economic crisis, and the devastating explosion in Beirut have resulted in Lebanon scoring far worse than would be expected. Over the past decade, the country’s score has fallen by nearly two full points.
  • Hong Kong has seen its happiness score sink for years now. Inequality, protests, instability, and now COVID-19 outbreaks have placed the region in an unusual zone on the chart: rich and unhappy.

Examining Inequality and Happiness

We’ve looked at the relationship between wealth and happiness between countries, but what about within countries?

The Gini Coefficient is a tool that allows us to do just that. This measure looks at income distribution across a population, and applies a score to that population. Simply put, a score of 0 would be “perfect equality”, and 1 would be “perfect inequality” (i.e. an individual or group of recipients is receiving the entire income distribution).

Combined with the same happiness scale as before, this is how countries shape up.

Data visualization showing the relationship between inequality and happiness around the world

While there is no ironclad conclusion that can be derived from this dataset, there are big picture observations worth highlighting.

The 15 Countries With Highest Income Inequality

Countries with High inequalityHappiness ScoreGini Score
🇿🇦 South Africa5.20.63
🇳🇦 Namibia4.50.59
🇿🇲 Zambia3.80.57
🇨🇴 Colombia5.80.54
🇲🇿 Mozambique5.00.54
🇧🇼 Botswana3.50.53
🇿🇼 Zimbabwe3.00.50
🇵🇦 Panama6.30.50
🇨🇷 Costa Rica6.60.49
🇧🇷 Brazil6.30.49
🇬🇹 Guatemala6.30.48
🇭🇳 Honduras6.00.48
🇧🇫 Burkina Faso4.70.47
🇪🇨 Ecuador5.50.47
🇨🇲 Cameroon5.00.47
Average5.252

First, countries with lower income inequality tend to also report more happiness. The 15 countries in this dataset with the highest inequality (shown above) have an average happiness score 1.3 lower than the 15 countries with the lowest inequality (shown below).

The 15 Countries With Lowest Income Inequality

Countries with low inequalityHappy ScoreGini Score
🇸🇰 Slovakia6.423.2
🇧🇾 Belarus5.824.4
🇸🇮 Slovenia6.624.4
🇦🇲 Armenia5.425.2
🇨🇿 Czech Republic6.925.3
🇺🇦 Ukraine5.125.6
🇲🇩 Moldova5.926
🇦🇪 United Arab Emirates6.626
🇮🇸 Iceland7.626.1
🇧🇪 Belgium6.827.2
🇩🇰 Denmark7.627.7
🇫🇮 Finland7.827.7
🇳🇴 Norway7.427.7
🇰🇿 Kazakhstan6.227.8
🇭🇷 Croatia6.128.9
Average6.526

Next, interesting regional differences emerge.

Despite high income inequality, many Latin American countries report levels of happiness similar to many much-wealthier European nations.

The Bottom Line

People have been seeking understanding on happiness for millennia now, and it’s unlikely that slicing and dicing datasets will crack the code. Still though, much like the pursuit of happiness, the pursuit of understanding is human nature.

And, in more concrete terms, the more policymakers and the public understand the link between wealth and happiness, the more likely we can shape societies that give us a better chance at living a happy life.

Where does this data come from?

Source: Credit Suisse Global Wealth Databook 2021, World Happiness Report 2022, World Bank

Data notes: This visualization includes countries that had available data for both happiness and wealth per adult. Credit Suisse notes that due to incomplete data, the following countries are estimates of average wealth per adult: North Macedonia, Kosovo, Guatemala, Dominican Republic, Honduras, Uzbekistan, Côte d’Ivoire, and South Sudan. Happiness data for countries is from the 2022 report, with the exception of: Qatar, DRC, Haiti, and South Sudan, which pull from the 2019 report. For Gini Coefficient calculations, only countries with data from 2014 onward were included. As a result, major economies such as India and Japan are excluded from that visualization.

Chart note: The wealth axis was plotted logarithmically to better show the trend visually. This approach is often used when a small number of results skew the visualization, making it harder to glean insight from. In this case, there are large extremes between the richest and poorest countries around the world.

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