Sentences to ponder

by on November 15, 2011 at 1:27 pm in Food and Drink, Political Science | Permalink

En Argentina, ¡el precio del Big Mac subió casi el doble que el IPC oficial! Mientras el IPC oficial aumentó en 10% en 2010, el precio del Big Mac aumentó en 19%.

In other words, the real price of the Big Mac rose nearly twice as much as the official statistics were willing to admit, in Argentina of course.  That’s not right, so the government sprang into action.  The minister of the commerce department “persuaded” McDonald’s to price the Big Mac at $16, while other sandwiches at the chain are in the $21 to $23 range.

The outlets now keep the Big Mac well-hidden, full story (in Spanish) here.  For the pointer I thank Raphael Corbi.

Economist Big Mac index, be warned!

MetaThought November 15, 2011 at 1:53 pm

Is it called el Big Mac in spanish?

Silas Barta November 15, 2011 at 1:56 pm

No, it’s called El Royale because of the metric system … dangit, I forgot how that one goes…

CBBB November 15, 2011 at 4:37 pm

It’s the Quarter Pounder that’s called Le Royale

Come on

MP November 16, 2011 at 4:49 am

A Big Mac’s a Big Mac, but they call it Le Big Mac.

Maybe El Big Mac for Spanish.

William November 15, 2011 at 1:56 pm

Do you know what they call a quarter pounder with cheese?

aa November 15, 2011 at 2:01 pm

you dig it the most

Scott H. November 15, 2011 at 3:33 pm

Cuarto de libra con queso. Lol.

Scott H. November 15, 2011 at 3:33 pm

lol only because it’s the literal translation.

John B. November 17, 2011 at 10:50 am

El Grande Mac.

Silas Barta November 15, 2011 at 1:59 pm

Just goes to show, even the Big Mac index can be Lucas/Goodhart’d. Now imagine what happens with measures that allow significantly more subjectivity and judgment! (CPI, GDP, NGDP …)

Btw, are those prices really in USD? Because Argentina uses the peso.

Also, I take it the Big Mac isn’t on the menu, so you have to specfically ask for it, perhaps even get the manager’s approval to let you buy one?

Roy November 16, 2011 at 11:13 am

The $ symbol is the traditional symbol for Pesos, I assume it is still used as such in Argentina. The original currency in the US was the Spanish (ie. Mexican) Dollar or “piece of eight” from which I believe the word Peso derives.

ChacoKevy November 15, 2011 at 2:06 pm

The visit to McDonald’s website in Argentina is fun. http://www.mcdonalds.com.ar
They are promoting their Angus burger “Nueva con Salsa Tasty”!

Nylund November 15, 2011 at 7:03 pm

I guess the old non-tasty sauce wasn’t a big hit.

Frank November 15, 2011 at 2:24 pm

Many years ago, while vacationing in France, I noticed that some menu items had asterisks on them. I asked the meaning, and was told that these were price-controlled items. So, I ordered the first one on the menu. No, I was told, that dish was already sold out for that days lunch!

May as well dispense hallucinogenics to the population.

Michael G Heller November 15, 2011 at 2:45 pm

Can I do Barandiaran. Tyler, forget Argentina. It has been like this since 1911. Only the burgers have improved. You should turn your attention to France and Spain. They matter and they are going down. Sorry, this means more hard work for you!

FYI November 15, 2011 at 2:58 pm

Nah. Not mad enough. It is also not true Barandiaran without at least one mention to ‘fraudulent clowns’.

msgkings November 15, 2011 at 3:06 pm

LOL and +1 to both of you.

Rahul November 15, 2011 at 3:26 pm

Please cite an esoteric old reference from the sixties.

Michael G Heller November 15, 2011 at 3:37 pm

Approximately 60 minutes ago:
Mike Riddell of M&G, one of Europe’s biggest fund managers, called it “probably the most worrying day” of the crisis so far.

Michael G Heller November 15, 2011 at 3:39 pm

Austrians should be worried too.

Michael G Heller November 15, 2011 at 4:02 pm

Rahul:
But the Mayor of New York liked Parsons!

You might enjoy this one from the 1860s:

Two celibate buddhist monks see a beautiful woman by the road unable to cross a stream. The first monk sweeps her up in his arms and carries her across the stream and puts her down on the other side. Sixty minutes later the second monk asks “brother, should you have got so physically close to that woman?”. The first monk responds, “Hey, I put her down an hour ago, are you still thinking about her?”

Tyler November 15, 2011 at 2:48 pm

Problem solved!

Tyler_A November 15, 2011 at 2:50 pm

whoops, I better clarify. That (above) wasn’t Tyler Cowen. Different Tyler…

KLO November 15, 2011 at 2:55 pm

Most of McDonald’s stores are franchises. In the U.S. franchises are not generally subject to maximum price agreements and can, as a consequence, set their own prices. I would not assume the same is true in Argentina, but I do wonder about this story, which sounds rather apocryphal to me.

Bill November 15, 2011 at 3:09 pm

You didn’t see what happened with McRib prices.

Andrew' November 15, 2011 at 3:26 pm

Just introduce the Fair Sized Mac. Or target the nBig Mac

Yancey Ward November 15, 2011 at 3:26 pm

And yet we are assured the Argentina is growing like gangbusters.

Michael G Heller November 15, 2011 at 6:43 pm

All that’s growing is soya. Cattle pasture turned over to soya. As you suggest it’s at present an economy of mirage-level distortions.

neil November 15, 2011 at 3:31 pm

Maybe Tyler meant to make this clear, but the Argentine government took this move specifically in order to manipulate the Economist’s Big Mac Index, not because the Argentine people depend heavily on sesame seed buns. At least, that’s what the link claims.

IVV November 15, 2011 at 4:35 pm

Wow, The Economist Big Mac Index is really that powerful, huh?

neil November 15, 2011 at 4:55 pm

It makes sense as part of a concerted effort to massage inflation indices.

Rahul November 15, 2011 at 4:32 pm

Tyler’s being brave; wasn’t questioning the official inflation an arrestable offence? Don’t travel to Argentina anytime soon, Tyler!

Andrew' November 16, 2011 at 5:17 am

New spin on the old joke, “when we are out of them we’ll charge half-price too.”

joshua November 15, 2011 at 6:14 pm

What does it say about my ideology if I initially skim-translated “Big Mac subió casi” as “Big Mac subsidy”?

mgblock November 15, 2011 at 11:25 pm

I live in Argentina so I had the opportunity to test this first hand. I went to a McDonald’s yesterday to get a Big Mac. It’s true that it’s not advertised (the Triple Big Mac is). I also got an orange juice. Without asking, I got fries thrown in for the deal as well. Cost of the meal: 23 pesos, or around US$5.40 using an exchange rate of $=4.25.

Renee November 16, 2011 at 12:20 pm

I’m lovin’ it.

TallDave November 16, 2011 at 6:52 pm

The problem is eventually you run out of other people’s Big Macs.

Holly November 17, 2011 at 1:04 pm

Between determining the correct price of a Big Mac and determining the best pork arbitrage strategy for the McRib (http://www.theawl.com/2011/11/a-conspiracy-of-hogs-the-mcrib-as-arbitrage) I think I can safely say that all the best economists are now working for McDonalds

Andreas Moser November 21, 2011 at 7:14 am

And they are getting fat.

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