What keeps the CPI down is technological progress in other goods, like cars and TVs.
By the end of my tenure at McDonald's, we were cooking patties and storing them in steam warmers for up to 30 minutes before tossing them. The same patties were used for regular burgers and Big Macs. We'd create Big Macs as needed by demand, assembling them later.
I don't know the #s, but was told that this change was to reduce product waste.
Grilling equipment and process also changed over this time period, slightly reducing the number of staff needed to run the grill and reduce the likelihood of overcooked (and thus wasted) meat.
I imagine numerous other efficiencies/changes have been made over the decades that would influence the cost to make Big Macs.
There are a lot of ways to make things cheaper. The world has seen startling progress in logistics, organisation, science and tech in the last 30 years. Some of that is applicable to gathering food more cheaply.
I suppose maybe all the gains could have been eaten up (heh heh) by population growth. The underlying equilibrium here isn't static, at any rate. The real price of a hamburger will not be steady.
[0] https://www.ers.usda.gov/data-products/agricultural-producti...
That big mac is at the end of a literally global supply chain. The cost of the tires on the car of the fry cook and the number of temperature sensors one can afford to put in the reefer ship that gets the tomatoes from Argintina all have an impact on the overhead of a big mac. And this is in addition to all the direct process improvements others have mentioned. Heck, the internet has opened up a whole new world of operational efficiency for the farmer that grows the grain that feeds the cattle. He can buy parts for his machines or compare spec sheets for fertilizers from his iphone while sitting in the cab of his tractor that almost drives itself. In 2001 he had to thumb through a catalog or call someone.
1) Self-order kiosks. Definitely reduce costs and required number of workers needed at any time substantially.
2) Scheduling applications. More efficiently schedule workers, trade shifts, etc.
3) Improved warehouse, distribution infrastructure, logistics, coordination software, optimization around deliveries, predicted usage, etc.
Honestly, what they need is a voice AI to take your order in the mobile app.
- more reliable bun-making machines that need a lower ratio of human oversight / bun produced.
- more automation in packaging the meat patties.
The price of a big mac obeys supply and demand.
The actual cost of producing it is but one factor in many in the final price, and likely not the most important.
Where the hump is in the price vs actual volume of Big Mac sold curve actually is what matters.
Other than that price differences in food between $ and CHF are likely mostly explained because work hours simply cost a lot more around here.
Not sure why you would think that. McDonalds is famous for catering it's menu and service to it's locale.
In Australia they were required to serve real chicken in their nuggets, and they're always advertising that they use locally sourced beef for their burgers.
They also rebranded in a sense to upmarket themselves, and started selling salads, cakes and coffees in order to sneak a foot into the Australian cafe scene.
Hence, it’s a non standard product, and a pretty dumb basis for an index.
I saw Americans amazed at Europe’s “real cheese”, and Coca-Cola with “real sugar”. I have never heard the explanation for “real chicken” yet.
This is funny and scary at the same time.
USA (according to https://www.mcdonalds.com/us/en-us/product/chicken-mcnuggets... ) :
Ingredients: White Boneless Chicken, Water, Vegetable Oil (canola Oil, Corn Oil, Soybean Oil, Hydrogenated Soybean Oil), Enriched Flour (bleached Wheat Flour, Niacin, Reduced Iron, Thiamine Mononitrate, Riboflavin, Folic Acid), Bleached Wheat Flour, Yellow Corn Flour, Vegetable Starch (modified Corn, Wheat, Rice, Pea, Corn), Salt, Leavening (baking Soda, Sodium Aluminum Phosphate, Sodium Acid Pyrophosphate, Calcium Lactate, Monocalcium Phosphate), Spices, Yeast Extract, Lemon Juice Solids, Dextrose, Natural Flavors.
Australia (according to the PDFs here https://mcdonalds.com.au/maccas-food/nutrition ):
Ingredients: Chicken, Water, Flour (Wheat, Corn), Canola Oil, Starch (1420, 1422, Corn, Wheat, Tapioca), Mineral Salts (450, 500, 451, 341, 327), Salt, Spices (Celery, White Pepper, Black Pepper), Sunflower Oil, Dextrose.
It was Pink Slime for awhile. "Real Chicken" is the continuing strategy to claw back from the PR nightmare.
https://www.eatthis.com/mcdonalds-debunks-rumor-about-mcnugg...
Even assuming the 2% numbers are more representative of the average household, the 4% big mac number sounds entirely consistent with that.
TL;DR: this is interesting, but I don't see how this data clarifies anything.
They present it as a way of looking at forex rates. If 1 USD buys you 1 swiss franc, but a Big Mac costs $5 here and 7 CHF there, then maybe the franc is overvalued. In any case you lose McDonald's purchasing power by converting.
But you could just as easily use it for inflation.
Big Macs are a stable product. A Big Mac sold in 1985 is very similar to one sold yesterday. Also, it includes a good mix of basic inputs. Land rents, transport costs, labor, and food ingredients.
Here's the raw data.
https://raw.githubusercontent.com/TheEconomist/big-mac-data/...
In the US, a Big Mac cost $2.54 in 2001 and $5.65 in 2021.
That works out to 4.0% annual inflation.
https://www.google.com/search?q=(5.65%2F2.54)%5E(1%2F20)&oq=...
The official numbers were 2% that entire time. Those come from a complex calculation using an always-shifting basket.