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(Quartz)   The only economic indicator that matters: how long you have to work to buy a beer   (qz.com) divider line 44
    More: Cool, minimum wages, International Labour Organization, economic indicator  
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1731 clicks; posted to Business » on 07 Feb 2014 at 11:56 AM (24 weeks ago)   |  Favorite    |   share:  Share on Twitter share via Email Share on Facebook   more»



44 Comments   (+0 »)
   
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2014-02-07 12:02:54 PM
Hah! This type of indicator is one I have been pushing for years. Instead of beer (which I might add to the list) it is a comprehensive list of goods and services needed to maintain a healthy live.
 
2014-02-07 12:04:55 PM
But what happens if I make my own beer? Should I go in the price of the ingredients, or base it off of what it's worth in the end?
 
2014-02-07 12:05:22 PM
Not summiter, btw.
The reason it works is that it uses unchangeable items. Time and a good/service. An Hour is an Hour and an egg is an egg.
 
2014-02-07 12:07:57 PM

Reverend J: But what happens if I make my own beer? Should I go in the price of the ingredients, or base it off of what it's worth in the end?


You go off how long it takes you to make the beer. The unit scheme is time per item.
 
2014-02-07 12:13:08 PM
Well this gives me reason to go against a raise in minimum wage.  Beer would get expensive.
 
2014-02-07 12:23:27 PM
Holy crap--I though bar beer was expensive, and it take about 0.1 for me (not great, but not bad).

/Guess I'm cheap.
//Milwaukee's Best is the same recipe as the old Gettelman brand, and highly underrated.
 
2014-02-07 12:31:08 PM
.4 hours can buy me a single malt.  And make it a double.

I guess I'm rich.
 
2014-02-07 12:38:32 PM
I'll drink to that.
 
2014-02-07 12:41:24 PM
Beer is about a dollar per bottle and minimum wage is $7.50/hour so the US should be .15 hours not .4 hours.
 
2014-02-07 12:43:36 PM

Mr. Eugenides: Beer is about a dollar per bottle and minimum wage is $7.50/hour so the US should be .15 hours not .4 hours.


Defined as price at a bar.  So ~$3.  About right for my region.
 
2014-02-07 12:52:58 PM

Reverend J: But what happens if I make my own beer? Should I go in the price of the ingredients, or base it off of what it's worth in the end?


I make my own beer AND I'm self employed.  I think I just divided by zero.
 
2014-02-07 12:53:26 PM
For my salary and the beer I like to buy it's about 2 minutes per beer.
 
2014-02-07 12:55:18 PM
Norway is bananas.  $11.26 for a half-liter draft?!?
 
2014-02-07 01:01:53 PM
Beer should be for people who have marketable skills
 
2014-02-07 01:18:34 PM

tricycleracer: Norway is bananas.  $11.26 for a half-liter draft?!?


Not sure how, but I suspect it's related to their selling Aass beer.
http://en.wikipedia.org/wiki/Aass_Bryggeri
 
2014-02-07 01:20:01 PM

NewWorldDan: Reverend J: But what happens if I make my own beer? Should I go in the price of the ingredients, or base it off of what it's worth in the end?

I make my own beer AND I'm self employed.  I think I just divided by zero.


Good thing you don't own a brewery too, you could cause the whole world to be sucked into a black hole.
 
2014-02-07 01:46:23 PM

MrBallou: tricycleracer: Norway is bananas.  $11.26 for a half-liter draft?!?

Not sure how, but I suspect it's related to their selling Aass beer.
http://en.wikipedia.org/wiki/Aass_Bryggeri


That's some sweet Aass-beer.
 
2014-02-07 02:13:45 PM

Smeggy Smurf: Beer should be for people who have marketable skills


But then what would we reserve the grey goose for?
 
2014-02-07 02:49:01 PM

BumpInTheNight: Smeggy Smurf: Beer should be for people who have marketable skills

But then what would we reserve the grey goose for?


Grey Goose is for closers.
 
2014-02-07 03:19:05 PM

tricycleracer: Norway is bananas.  $11.26 for a half-liter draft?!?


You have to take those high costs in context.  When all of your schooling is free, health care is free, basics are subsidized, housing is possibly subsidized, and infrastructure is public, people have a much higher ratio of disposable income.  Hell, beer is one of the few things you have to pay for.
 
2014-02-07 03:34:09 PM

mr lawson: Not summiter, btw.
The reason it works is that it uses unchangeable items. Time and a good/service. An Hour is an Hour and an egg is an egg.


2.bp.blogspot.com

What a summiter may look like.
 
2014-02-07 04:09:27 PM

Saiga410: Well this gives me reason to go against a raise in minimum wage.  Beer would get expensive.


Actually in TFA they're measuring the price of a beer against hours of labor at minimum wage.  So if the minimum wage goes up, and the price of beer goes up by a smaller percentage than the minimum wage, it would be an improvement in the index.

//really should look into moving to Puerto Rico.
 
2014-02-07 04:14:52 PM

unyon: tricycleracer: Norway is bananas.  $11.26 for a half-liter draft?!?

You have to take those high costs in context.  When all of your schooling is free, health care is free, basics are subsidized, housing is possibly subsidized, and infrastructure is public, people have a much higher ratio of disposable income.  Hell, beer is one of the few things you have to pay for.


Actually, even among other godless socialist European states Norway has an exceptionally high tax on alcohol.
 
2014-02-07 05:24:36 PM

odinsposse: unyon: tricycleracer: Norway is bananas.  $11.26 for a half-liter draft?!?

You have to take those high costs in context.  When all of your schooling is free, health care is free, basics are subsidized, housing is possibly subsidized, and infrastructure is public, people have a much higher ratio of disposable income.  Hell, beer is one of the few things you have to pay for.

Actually, even among other godless socialist European states Norway has an exceptionally high tax on alcohol.


'Sin Taxes' are pretty common.  Being a Canadian with a wide range of vices, I'm more than familiar with them.  I'm just happy that weed is still illegal, thats the only thing keeping it cheap.
 
2014-02-07 05:28:12 PM

mr lawson: Not summiter, btw.
The reason it works is that it uses unchangeable items. Time and a good/service. An Hour is an Hour and an egg is an egg.


This is done all the time. Look for the words Purchasing Power Parity. They mean that prices are adjusted by comparing the cost of a basket of similar goods in each country. It's much harder to do with one item. Beer, like they use in tfa, is a particularly bad example, because different countries love to impose taxes, government monopolies and price minimums, etc. Here in Canada, you'd be extremely hard pressed to find regular priced beer in a bar for less than $4, and for a full pint an average price is almost certainly well over $5. From what farkers are saying, the US price seems to be more like $3.  Of course, if you have lots of goods, like you were saying before, the problems get better, but it's still really hard to distill the differences in cost of living down to one number.

If you want numbers, the OECD does it every month (
http://stats.oecd.org/Index.aspx?DataSetCode=CPL). Once you have the currency conversion, you just convert the minimum wage, or whatever you want to compare, into once currency, and divide. For example, Canada's index relative to the US in January was 121, meaning it's 21% more expensive to live in Canada. So, if minimum wage here were $10cdn, you convert that to $9.06usd then divide by 1.21 to get $7.49 in real USD, compared to a US federal minimum wage of $7.25.

If all that's tl;dr, try this:  http://www.economist.com/content/big-mac-index. It's a bit snappier and easier to explain, and because the price of a big mac factors in labour, food prices and rent (for the store), it's actually a pretty good 1 item snapshot of relative prices.
 
2014-02-07 06:10:55 PM

neon_god: If all that's tl;dr


lol...far from tl;dr

Got a degree in econ...THAT was tl;dr**..heh

The main feature of this type of index is that it allows almost instant understanding of what is important without having to figure in inflation and other variables that can be skewed for political bent.
Like I said before, An hour of work is an hour of work no matter what and an egg is an egg, a square foot of living space is a square foot of living space no matter what.
How long does it take a person to work to earn a certain basket of goods.

**did read
 
2014-02-07 07:09:47 PM

mr lawson: neon_god: If all that's tl;dr

lol...far from tl;dr

Got a degree in econ...THAT was tl;dr**..heh

The main feature of this type of index is that it allows almost instant understanding of what is important without having to figure in inflation and other variables that can be skewed for political bent.
Like I said before, An hour of work is an hour of work no matter what and an egg is an egg, a square foot of living space is a square foot of living space no matter what.
How long does it take a person to work to earn a certain basket of goods.

**did read


Yeah, I can see how that'd be useful, although for international comparisons you'd have a little trouble because of differing lifestyles, especially wrt food. I'd think the OECD ppp table I linked to is the closest thing that exists to what you want, but you're right that it's not the easiest to grasp for non-economists. I guess the Big Mac index, but reformatted so it was burgers per minimum wage hour, would work well. Lots of other costs are implicitly included in the cost, like I said before, and it has the advantage of being a good that's available everywhere ald almost exactly the same
 
2014-02-07 07:11:32 PM

mr lawson: neon_god: If all that's tl;dr

lol...far from tl;dr

Got a degree in econ...THAT was tl;dr**..heh

The main feature of this type of index is that it allows almost instant understanding of what is important without having to figure in inflation and other variables that can be skewed for political bent.
Like I said before, An hour of work is an hour of work no matter what and an egg is an egg, a square foot of living space is a square foot of living space no matter what.
How long does it take a person to work to earn a certain basket of goods.

**did read


With you on the economics degree, by the way. I have a microeconomics textbook from grad school that I'm litterally afraid of.
 
2014-02-07 07:13:15 PM

neon_god: I have a microeconomics textbook from grad school that I'm litterally afraid of.


lutz
 
2014-02-07 07:13:24 PM

unyon: 'Sin Taxes' are pretty common.  Being a Canadian with a wide range of vices, I'm more than familiar with them.



I love it when I go to Canadia and get into beer price discussions.  In the smaller towns they never believe me when I mention $12.00 a case.  Or how it's legal for Wisconsin minors to publicly drink with their parents.
 
2014-02-07 07:18:23 PM

neon_god: especially wrt food.


mine was based on local food but indexed for (kilo)calories. I tried to make sure everything was not skewable.
The main reason for it was to find increase/decrease in disposable income over time.
However, I ran into some problems regarding categories that didn't exist over the entire time line,, namely internet/cell phone.
 
2014-02-07 07:18:42 PM

fickenchucker: I love it when I go to Canadia and get into beer price discussions. In the smaller towns they never believe me when I mention $12.00 a case. Or how it's legal for Wisconsin minors to publicly drink with their parents.


I'm just appalled they'd try to charge that much for 2nd hand Canadian beer. ;)
 
2014-02-07 07:33:25 PM

mr lawson: neon_god: especially wrt food.

mine was based on local food but indexed for (kilo)calories. I tried to make sure everything was not skewable.
The main reason for it was to find increase/decrease in disposable income over time.
However, I ran into some problems regarding categories that didn't exist over the entire time line,, namely internet/cell phone.


That'd work, if you had a good handle on local diets. Technology change is tough, though. Even just the fact that goods today are by and large much better than their historical equivalent. Cars are a good example.
 
2014-02-07 07:41:12 PM

neon_god: Even just the fact that goods today are by and large much better than their historical equivalent. Cars are a good example.


That's kinnda the point. Although an egg is an egg, mass production has driven down the time needed to obtain one. Same for cars. Mass production and better quality has driven down hours needed to work to obtain 1 mile driven.
 
2014-02-07 08:13:01 PM

mr lawson: neon_god: Even just the fact that goods today are by and large much better than their historical equivalent. Cars are a good example.

That's kinnda the point. Although an egg is an egg, mass production has driven down the time needed to obtain one. Same for cars. Mass production and better quality has driven down hours needed to work to obtain 1 mile driven.


Yeah, I understand. I'm just saying that you could argue that including any manufactured goods introduces the possibility that the quality of goods has improved, separate from cost. The fact that that 1 mile driven is safer, more comfortable and probably faster matters, too. If you don't account for it, you're arguably undervaluing the car.
 
2014-02-07 08:20:24 PM

neon_god: If you don't account for it, you're arguably undervaluing the car.


very true. (YEA! you do get what I was doing. Makes me feel all warm and fuzzy..seriously!)
The reason I did not include those types of variables was because they are qualitative and not quantitative. Safety I probably could had incorporated, but didn't feel like it.
I wanted just a basic index so I could do a time-series analysis on disposable income.
 
2014-02-07 08:21:22 PM
I wished I still had the paper :-(
 
2014-02-07 08:32:29 PM
I can say, I might be recreating it.
I had an idea couple years ago.
When bitcoin came out, obviously I loved the idea. Even had a few hundred of them myself. (lost them when I reformatted my computer..grrrr)
But I didn't like the preset limit of 21 million.
Starting to think, take this index, normalize it to say 2010, increase/decrease the supply as a function of both global gdp and network usage.
Stable prices!
basically a real-time fed without any influences from direct governmental policies.

Still needs a lot of work, i know
 
2014-02-07 08:43:33 PM

mr lawson: neon_god: If you don't account for it, you're arguably undervaluing the car.

very true. (YEA! you do get what I was doing. Makes me feel all warm and fuzzy..seriously!)
The reason I did not include those types of variables was because they are qualitative and not quantitative. Safety I probably could had incorporated, but didn't feel like it.
I wanted just a basic index so I could do a time-series analysis on disposable income.


Yeah, it's impossible to fix in any scientific way, and it's basically a nitpick anyways. Sounds like a good paper.
 
2014-02-07 11:38:18 PM

Reverend J: But what happens if I make my own beer?


Then we all get to listen to you yap about how amazing your beer is compared to all the swill that commoners drink.
 
2014-02-08 03:11:50 AM
Georgia is certainly struggling.

At least they have The Masters to look forward to in a couple of months.
 
2014-02-08 03:48:35 AM
a beer? not sure...

about 5 minutes to buy a case of beer. that's 24 cans for those of you who are not sure.
 
2014-02-08 01:51:13 PM
The take away: despite our supposedly low minimum wage, our minimum wage peeps can buy a beer every bit as soon as Japan, Germany, Spain. This makes sense, as raising the minimum wage would just raise the cost of beer, making it take the same amount of time. I feel that the difference between countries likely isn't minimum wage differences but beer prices.

For a nation where 97.4% of the workers make more than minimum wage like ours, that might not be the best stat to measure for "how long it takes to buy a beer". It just doesn't apply to most of the population. I would like to see a ranking of "how many of this country's workers make enough to buy beers faster than they can drink them." That would be a good measure of general prosperity and drunkenness potential.
 
2014-02-08 04:35:39 PM

Smeggy Smurf: Beer should be for people who have marketable skills


You could let the unskilled laborers (read peons) drink beer, too, and have slightly less shiatty morale. Also, you could drink whisky, since finding a beer that is more appealing than a jar of piss seems to be vastly more difficult than finding a whisky that doesn't taste like brass cleaner smells. Nice job being a condescending dick, though! Cheers.
 
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