What does HackerNews think of big-mac-data?

>CPI is also a broken measure due to its inability to measure wealth inequality (sampling median purchasers only)

And that's fine, because the CPI's job is to measure how prices have changed (ie. inflation), not wealth inequality. Just because a given metric doesn't support your pet cause doesn't mean it's "broken". It's like complaining GDP is a broken metric because it doesn't measure how oppressed minorities are.

> Real inflation has likely been ~33% higher than reported for decades (the Big Mac index is probably the true gold standard).

I tried to confirm this and the results were far from conclusive. The big mac index data can be obtained from github[1] and gives a 129.9% increase between april 2000 (earliest data available) and july 2022 (latest data available). To compare this against the CPI data, I checked on FRED and the "Consumer Price Index for All Urban Consumers: Food Away from Home in U.S. City Average"[2] component of the CPI gives a 87.0% for the same time period. If you take those numbers and convert them to annualized rates, you will indeed find a 33.3% difference between them. Looks like your claim is confirmed, right? But not so fast. The CPI category listed above actually breaks down into more detailed categories, including "Limited service meals and snacks", which presumably the big mac falls into. That data isn't available on FRED but can be found on BLS's data viewer[3] and gives you a 105.8% increase for the same time period. If you convert that to an annualized rate the difference between that and the big mac index drops to 15%. I suspect if we try harder we can eliminate more of the discrepancy. For instance, the "Limited service meals and snacks" index was probably computed from a basket of items, not just big macs. Items that have fatter margins (eg. fries or drinks) might have inflated slower than big macs, thereby dragging the growth of the basket down and explaining the difference.

[1] https://github.com/TheEconomist/big-mac-data/

[2] https://fred.stlouisfed.org/series/CUSR0000SEFV

[3] https://beta.bls.gov/dataViewer/view

So I thought this was interesting and looked into it.

The website has a reference for where they get their big mac prices:

> Big Mac Index measures the average price of a Big Mac at McDonald's in the United States and is famously used in the Economist's Big Mac Index to measure inflation.

And a link to the Economist article (https://www.economist.com/big-mac-index) where they further link to their methodology: https://github.com/TheEconomist/big-mac-data

The USA average seemed high to me, and I found this resource: https://www.zippia.com/advice/how-much-big-mac-costs-states/ - Nov 2021 - which suggests $4.40. But the Economists data/csv file really does say $5.81 for the USA... so that's where I bow out!

Here is a sort of interactive infograph version of the Big Mac index: https://www.economist.com/news/2019/01/10/the-big-mac-index

The data is on github: https://github.com/TheEconomist/big-mac-data