Professor Štěpán Jurajda
We are glad to announce forthcoming open research seminar of St Petersburg School of Economics and Management HSE. Professor Štěpán Jurajda (CERGE-EI) will present his paper «Comparing Real Wage Rates using McWages». The seminar will take place on Nov 25, 2016, at 17:30, at Kantemirovskaya 3A, room 346.
If you would like to attend the seminar, please send your name and affiliation to: firstname.lastname@example.org.
Thanks to the standardized work protocol and technology of McDonald’s restaurants across the globe, the hourly wage rate of Basic Crew McDonald’s workers offers consistent, easy-to-interpret, and up-to-date wage comparisons. First, the wage rate expressed in a common currency measures the costs of labor in prices of tradables and can be linked to the country’s marginal product of labor and TFP. Second, the wage rate in PPP or in Big Macs (earned) Per Hour (BMPH) measures the purchasing power of labor income and provides an indicator of workers’ living standards. We compare McWages across 64 countries for 2007-16 and track their evolution between 2000 and 2010 for a subset of 27 countries. Wage rates of workers providing the same human capital input and using the same technology are an order of magnitude higher in the richest countries compared to some of the less productive economies. Between 2000 and 2010, the BMPH index has grown by more than two thirds in Russia, China or Korea, by about one third in India, Taiwan or Columbia, but it has declined in Brazil, Venezuela or the US. Our data provide natural input into output-per-worker comparisons, migration studies, or trade models.