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英语翻译
McDonald's tries very hard to make its Big Mac taste the same all over the world,but the problem with the Big Mac index is that it is a cheap "junk" food in the United States and other rich countries and a luxury treat for the vast majority of Chinese consumers.The differences in the Big Mac price could reflect the pricing-to-market effect rather than currency valuation (Pakko and Pollard,2003).To fill a data void,we went to the other end of the basket spectrum and developed a price index called "Shef" (which stands for Salt,Haircut,Electricity,and Flour) that better reflects a developing country's perspective.The index follows the principle of the traditional Chinese measure of cost of living for the masses,which include four items:firewood,rice,cooking oil,and salt.In the Shef index,firewood is replaced by electricity and rice by wheat flour to make it more relevant for today's China as well as a wide range of countries.Unlike the Big Mac,which has at least seven commodity components,the items we selected (salt,electricity,and wheat flour) are perhaps as "pure commodities" as they can be.We also replaced cooking oil with a basic man's haircut to represent a pure service in the necessity category whose productivity has been largely immune from technological changes.Salt and flour represent a minimal share of consumer spending in rich countries,but they are standard items and necessities for the poor.We have collected Shef data for 27 major countries,which represent more than 85 percent of global GDP and 90 percent of global vehicle sales.
Table 1 shows the Shef data for the United States and China.The results are not surprising.Using the current exchange rate,salt and flour are 80 percent cheaper in China,while for the price of one haircut in the United States,you can have ten in China.Electricity prices are not so cheap in China,relatively speaking.If we treat these four items with equal weight,the Shef index seems to suggest that the RMB is 79 percent undervalued against the dollar,almost exactly the same as the World Bank's PPP measure but substantially greater than the Big Mac index.How is China's undervaluation compared with other countries?Figure 1 shows the Shef index plotted against GDP per capita for 27 countries.There is a clear positive correlation between the two variables,with China and India having the lowest income and the most undervalued currencies.This correlation is known as the Balassa-Samuelson effect (Bergin et al.,2004) and shows that China's PPP exchange rate is not unusual given its level of economic development.The contrast between the poor man's Shef index and the rich man's Big Mac index also suggests that as income rises in China,the PPP valuation is likely to correct itself as Chinese people spend more on things like Big Macs and less on basic commodity items in the Shef index.
McDonald's tries very hard to make its Big Mac taste the same all over the world,but the problem with the Big Mac index is that it is a cheap "junk" food in the United States and other rich countries and a luxury treat for the vast majority of Chinese consumers.The differences in the Big Mac price could reflect the pricing-to-market effect rather than currency valuation (Pakko and Pollard,2003).To fill a data void,we went to the other end of the basket spectrum and developed a price index called "Shef" (which stands for Salt,Haircut,Electricity,and Flour) that better reflects a developing country's perspective.The index follows the principle of the traditional Chinese measure of cost of living for the masses,which include four items:firewood,rice,cooking oil,and salt.In the Shef index,firewood is replaced by electricity and rice by wheat flour to make it more relevant for today's China as well as a wide range of countries.Unlike the Big Mac,which has at least seven commodity components,the items we selected (salt,electricity,and wheat flour) are perhaps as "pure commodities" as they can be.We also replaced cooking oil with a basic man's haircut to represent a pure service in the necessity category whose productivity has been largely immune from technological changes.Salt and flour represent a minimal share of consumer spending in rich countries,but they are standard items and necessities for the poor.We have collected Shef data for 27 major countries,which represent more than 85 percent of global GDP and 90 percent of global vehicle sales.
Table 1 shows the Shef data for the United States and China.The results are not surprising.Using the current exchange rate,salt and flour are 80 percent cheaper in China,while for the price of one haircut in the United States,you can have ten in China.Electricity prices are not so cheap in China,relatively speaking.If we treat these four items with equal weight,the Shef index seems to suggest that the RMB is 79 percent undervalued against the dollar,almost exactly the same as the World Bank's PPP measure but substantially greater than the Big Mac index.How is China's undervaluation compared with other countries?Figure 1 shows the Shef index plotted against GDP per capita for 27 countries.There is a clear positive correlation between the two variables,with China and India having the lowest income and the most undervalued currencies.This correlation is known as the Balassa-Samuelson effect (Bergin et al.,2004) and shows that China's PPP exchange rate is not unusual given its level of economic development.The contrast between the poor man's Shef index and the rich man's Big Mac index also suggests that as income rises in China,the PPP valuation is likely to correct itself as Chinese people spend more on things like Big Macs and less on basic commodity items in the Shef index.
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