The Economist’s Big Mac Index is calculated with R

October 12, 2018

(This article was first published on Revolutions, and kindly contributed to R-bloggers)

The Economist's Big Mac Index (also described on Wikipedia if you're not a subscriber) was created (somewhat tongue-in-cheek) as a measure to compare the purchasing power of money in different countries. Since Big Macs are available just about everywhere in the world, the price of a Big Mac in Sweden — expressed in US dollars — gives an American traveler a sense of how much more expensive things will be in Stockholm. And comparing the price of a Big Mac in several countries converted to a single baseline currency is a measure of how over-valued (or undervalued) those other currencies are compared to that baseline.


Since its inception in 1986, the Big Mac Index has been compiled and calculated manually, twice a year. But starting with the most recent published index (July 2018, shown above), the index is now calculated with R. This is the first example of a new program at The Economist to publish the data and methods behind its journalism, and here the data and code behind the Big Mac Index have been published as a Github repository. The method behind the index is provided as a richly-commented Jupyter Notebook, where you can also find some additional charts and within-currency analyses not published in the main index.

The repository is published under an open MIT license, meaning you can remix the code to create a new index on prices of another international commodity, provided you can find the data. Find everything you need at the Github repository linked below.

Github (TheEconomist): Data and methodology for the Big Mac index

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