Switzerland is an expensive place to live. If you guessed chocolate, you'd be wrong. Just why is a Big Mac so expensive in Switzerland? The answer just may lie in one of the things Switzerland is best known for. While the Big Mac can't provide a magical explanation of how the entire world economy works, it does provide a good foundation to begin investigating what's happening in a country's economy, as it has become a regular purchased commodity around the globe. I can hear The Hamburglar boarding the next plane to Kiev as we speak. On the other side of the spectrum, a Big Mac in Ukraine only costs $1.67. On the expensive side of things, a Big Mac will run you $6.82 in Switzerland. In the middle of the spectrum, we have the home of the Big Mac, the USA, where one of these iconic burgers costs USD $5.30. The latest data from the Big Mac Index provides ample proof of that. Basically, the theory behind PPP is that, over time, the price of a given “basket” of similar goods in any two countries will tend to equalize - in this case that 'basket' is a burger- and the more equalized the basket price is, the more parity between countries.

The Big Mac Index was originally cooked up (yes, pun intended) as a generally good-natured way of comparing the Purchasing-Power Parity (PPP) of different countries. At least that was the idea The Economist magazine had when they introduced the Big Mac Index in 1986 to convey country-by-country consumer purchasing power. Yes, you read that right: The mighty Big Mac can tell us a lot about a country's economy.

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