Mcdonalds Price Index
I have traveled to over 22 Countries around the world and in a couple of weeks I will coming to the DR. Many years ago someone showed me how to compare value when traveling. Here is how it works.
Go into a local Mcdonalds restaurant at a peak time and buy a Big Mac, Fries and Coke and compare the price you paid with price you would have paid back home. Look around and see how busy the restaurant is. Find out the hourly rate of the average worker.
In Canada, the average Mcdonalds employee earns $6.00 per hour, average cost of a Big Mac, Fries, Coke is $4.50. The ratio is +0.75%. Last year I travelled to Indonesia, the average worker got 40 cents an hour yet I paid about $4.00 for a Big Mac, Fries and Coke. The ratio was a whopping -10.00.
If the ratio at a Mcdonalds abroad is similar to the one back home than you should pay about the same for goods and services where you are traveling.
If the ratio is higher (ie.Australia +0.55), you would probably pay slightly more for goods and services locally than you would back home.
If the ratio is lower (ie. Indonesia, S.E. Asia -10.00) you would pay substanially less for goods and services than you would back home.
The facts is, tourists are always a minority, the local population most always will outnumber the tourists and the economics will be dictated by the majority.
I also like to compare other prices and situations. AZB wrote below how some bars are offering cuba-libre's for 10 peso's (1 Canadian Dollar) and 100 peso all you can drink nights. How does this compare to what I have now.
Last night I went to a bar close to the University of Calgary, 25 cent glasses of draft, $1.00 highballs (Vodka,Gin,Rye,Rum)
and they offer this every night until 11pm. I know several bars that offer these deals. You won't find these deals around Yuppy hangouts or around the tourist hotels but where the locals hangout.
My point is that one of the reasons tourists destinations go through Boom and Bust cycles is that they price themselves out of the market. The reality is that prices of many Goods and Services in Canada, DR and elsewhere will have to drop to bring them inline with the buying power of the average person.
My McThoughts on this McEconomy
___________________________
AZB wrote;
yeah, DR is sure heading towards troubling times. Less people are flying into and out of DR airports. Hotels claim to have as much as 50% less occupancy. The good news is that the beaches are not so much crowded as they used to be on sundays (sosua, cabarete).
When hard times like these hit DR, the prices of the hotels usually come down. The bars offer better prices as well. Ex: in costambar, i saw a sign "cuba-libre 10 pesos". Cuba libre= rum & coke. It was a german bar/restaurant on the main road into costambar, puerto plata.
A bar in santiago had offered 100 pesos p/p (guys) and 50 pesos / female for all you can drink type deal (open bar). Usually that place is decently full with young folks on a normal night and with a deal like this i thought there would be a line outside. To my surprise, there were only 15 people inside and the doorman desperately looking for people to enter. Totally dead.
Now this is scary stuff. People like myself who depend on the dominican economy to survive are seeing some tough times ahead.
But if you are a tourist, you may be able to get deals and service that you were not able to enjoy before. So come and come in groups. Have a nice vacation.
------------------------