Mariel Adie Tan 2012-02151 Globalization and Burgernomics

August 11, 2013

In my point of view, Globalization has definitely played a big part in shaping who we are right now because countries all around the world are now very much interdependent especially in the world of economics. With economics we think of supply and demand, import and export, countries exchanging goods and all of these contribute to what we call the Purchasing Power Parity (PPP) of every country. The group who presented about this mentioned about absolute PPP and relative PPP but I am still not quite sure what the difference of these two are. I understand that in absolute PPP exchange rates are assumed to be in equilibrium and in relative PPP they consider the inflation rates but I think the group forgot to discuss about what the Purchasing Power Parity of every country actually implies to their economy. They next topic they discussed was about Burgernomics. They talked about the Big Mac Index which was using the famous Big Mac sandwich to compare the PPP of every country. I wasnt surprised to know that there is a McDonalds franchise in almost every country in the world but what made me wonder was how people from different cultures all like McDonalds . The group mentioned that there are variations of kinds of burgers available. Like in India, they have a burger that does not have any real meat and in Japan they have Japanese ingredient infused burgers. I was pondering about whether the Big Mac Index is really an effective way to compare the PPP of every country because I could think of some factors which could affect this. For example, the actual size of the Big Mac. I have been to the United Stated of America and I can say that the size of their Big Mac is so much bigger than ours. I have noticed that the food in the McDonalds in America is always relatively bigger than the food available in the Asian countries. Also, not just the quantity but the quality of the ingredients definitely differs so I dont think that the PPP should be compared using the Big Mac. The Magnum Index was also mentioned. I remember when I went to Singapore with my family almost two years ago Magnum was not available in the Philippines yet but there were so many advertisements of Magnum in Singapore so I really wanted to try it. We went to 7eleven and I was surprised at how much it cost, around 150php, so I did not buy it anymore. I was also very confused because Magnum there was from a different brand, not Selecta, but they had the same logo. So when Magnum got here in the Philippines I was very happy that I could buy it three times less than the price in Singapore.