5 ms·

Cost of living is a swindle, at least when it applies internationally and cross culturally. If you want to live like a local in Jakarta (to use an extreme exam

by mantap 6y ago

Cost of living is a swindle, at least when it applies internationally and cross culturally. If you want to live like a local in Jakarta (to use an extreme example), you can do so very cheaply, $180 a month for a room, eat rice for breakfast lunch and dinner. If you want to live like a San Franciscan in Jakarta, it will cost as much if not more as in San Francisco. An apartment will cost several thousand dollars a month. Non-native food that gets imported, such as olive oil or cheese, will be very expensive. So which is the definition of "cost of living" of a city? Is it how the average person lives there, or is how much it costs for the same lifestyle as where the company is based?

jacknews 6y ago
Exactly. It's basically a scam to try and pay people in 'poor' countries less.
- deleted 6y ago
  [deleted]
cambalache 6y ago
Yeah, I always laugh at the naivete of many people from first world countries : "Wow down there in Mexico the dollar is worth 10X/8X/6X times as more". No, it fucking is not. Or let me rephrase, it does but just for an extremely small subset of things. Cars? No, more expensive in the third world. House? Not at all, for a similar house, same quality of construction, and neigborhood, expect to pay at the very least the same amount of money you pay in average in the US. Food? No. Clothes? No. Land? Probably but if you have to sell it if will be sold to a lower price too. The only reason the dollar is worth more is because the local wages are pitiful, that's it.
- Dirlewanger 6y ago
  How can local wages (in a currency other than USD) be "pitiful", but food cost "the same" for the USD? These are incongruent. Locals wouldn't be able to subsist on those food prices. The USD has greater purchasing power, that's just a fact.
  - internet_user 6y ago
    lower standard of living. people settle for less.
    - cambalache 6y ago
      Yes, if your options are, A) Earning 2.5 USD/h . B) Starving. Guess which one you will take.
  - NovemberWhiskey 6y ago
    Anyone who's ever done an international relocation understands this. It works like this. Your company asks you, a SF-based tech executive, to relocate to India for a three-year assignment. Notional cost of living in India is absurdly low. But your company will actually estimate that you'll need ~$50-100,000 more per year from a COL perspective. This is because your existing lifestyle is now composed of what are all luxury goods in India. A Toyota Camry is an expensive, luxury car in India with massively high rates of taxation. Even if you don't currently own a car, you will need to, because public transportation is some combination of unreliable, unsafe or unavailable. Vehicle maintenance will be much more expensive and frequent due to poor roads and the frequency of fender-benders. Your company will tell you that they recommend in the strongest possible terms that you hire a driver from the local area, because of the track record of outcomes when an expat gets into a traffic accident. Alcohol is incredibly expensive, particularly imported brands. Good luck if you like to eat steak. Restaurants that serve international cuisine are relatively rare, and those of good quality are actually expensive even by international standards. If you want to buy an item of technology that's near the leading edge, it's either not available, or only available via import with massive surcharges and taxes. Very little of the housing stock will meet your expectations, and you will probably end up in one of a very-few 'expat friendly' areas. You will be buying bottled water because the domestic water is not safe to drink. If you want to be confident of 24 hour power, you will either end up needing a place with its own generator, or to be in the one of the super-elite compounds that provides its own generation capacity where you're literally paying major world city prices. Visiting your family is now international travel involving stop-overs in Doha or London. Facilitation payments/bribes are now a budget item. The point is: cost of living differs depending on expectation. If you go to Mexico to live like a local, it will be very cheap. If you go to Mexico to live like an American, it will not be. EDIT: in fact, the real surprise to me was that the COL data from the big relo vendors like Cartus is nothing like symmetrical. If you look at say London/Tokyo as a city pair - there's a fairly large COL increase for moves in either direction.
gherkinnn 6y ago
Not entirely a swindle. I can buy considerably more food for 100 Euros in southern Italy than in Zurich. Rents are so much cheaper too. Same goes for eating out, going to the cinema, getting around, plumbers, and hair cuts. Most things, really. Of course, shipping some Swiss cheese and timber to Sicily in order to live my Zurich lifestyle is very expensive. There are some concessions in item availability depending on the location. But that's completely besides the point. I'm convinced that a sizeable amount of the "location doesn't matter" people are just bummed that they can't pull in a SF salary and live like a king on a small SEA island.
mac01021 6y ago
You've overlooked the case where I want to live like a Jakartan in San Francisco, eating rice for breakfast, lunch, and dinner, and renting 50 square meters of living space. Take the minimum, over all cultures, of what would be taken as a comfortable lifestyle, and then assess the income required to maintain that lifestyle in various cities to see that, in a real sense, those cities do have different costs of living. That said, I believe the most sensible companies will not allow their HR/payroll departments to apply a standard cost-of-living formula, simply because there are bound to be prospective employees in Jakarta whose market values are higher than those of other prospective employees who happen to live in SFO and, as an employer, I'll want to hire all those people at their respective market values.

by mantap 6y ago

jacknews 6y ago

Exactly. It's basically a scam to try and pay people in 'poor' countries less.

deleted 6y ago
[deleted]

cambalache 6y ago

Yeah, I always laugh at the naivete of many people from first world countries : "Wow down there in Mexico the dollar is worth 10X/8X/6X times as more". No, it fucking is not. Or let me rephrase, it does but just for an extremely small subset of things. Cars? No, more expensive in the third world. House? Not at all, for a similar house, same quality of construction, and neigborhood, expect to pay at the very least the same amount of money you pay in average in the US. Food? No. Clothes? No. Land? Probably but if you have to sell it if will be sold to a lower price too. The only reason the dollar is worth more is because the local wages are pitiful, that's it.

Dirlewanger 6y ago
How can local wages (in a currency other than USD) be "pitiful", but food cost "the same" for the USD? These are incongruent. Locals wouldn't be able to subsist on those food prices. The USD has greater purchasing power, that's just a fact.
- internet_user 6y ago
  lower standard of living. people settle for less.
  - cambalache 6y ago
    Yes, if your options are, A) Earning 2.5 USD/h . B) Starving. Guess which one you will take.
- NovemberWhiskey 6y ago
  Anyone who's ever done an international relocation understands this. It works like this. Your company asks you, a SF-based tech executive, to relocate to India for a three-year assignment. Notional cost of living in India is absurdly low. But your company will actually estimate that you'll need ~$50-100,000 more per year from a COL perspective. This is because your existing lifestyle is now composed of what are all luxury goods in India. A Toyota Camry is an expensive, luxury car in India with massively high rates of taxation. Even if you don't currently own a car, you will need to, because public transportation is some combination of unreliable, unsafe or unavailable. Vehicle maintenance will be much more expensive and frequent due to poor roads and the frequency of fender-benders. Your company will tell you that they recommend in the strongest possible terms that you hire a driver from the local area, because of the track record of outcomes when an expat gets into a traffic accident. Alcohol is incredibly expensive, particularly imported brands. Good luck if you like to eat steak. Restaurants that serve international cuisine are relatively rare, and those of good quality are actually expensive even by international standards. If you want to buy an item of technology that's near the leading edge, it's either not available, or only available via import with massive surcharges and taxes. Very little of the housing stock will meet your expectations, and you will probably end up in one of a very-few 'expat friendly' areas. You will be buying bottled water because the domestic water is not safe to drink. If you want to be confident of 24 hour power, you will either end up needing a place with its own generator, or to be in the one of the super-elite compounds that provides its own generation capacity where you're literally paying major world city prices. Visiting your family is now international travel involving stop-overs in Doha or London. Facilitation payments/bribes are now a budget item. The point is: cost of living differs depending on expectation. If you go to Mexico to live like a local, it will be very cheap. If you go to Mexico to live like an American, it will not be. EDIT: in fact, the real surprise to me was that the COL data from the big relo vendors like Cartus is nothing like symmetrical. If you look at say London/Tokyo as a city pair - there's a fairly large COL increase for moves in either direction.

gherkinnn 6y ago

Not entirely a swindle. I can buy considerably more food for 100 Euros in southern Italy than in Zurich. Rents are so much cheaper too. Same goes for eating out, going to the cinema, getting around, plumbers, and hair cuts. Most things, really. Of course, shipping some Swiss cheese and timber to Sicily in order to live my Zurich lifestyle is very expensive. There are some concessions in item availability depending on the location. But that's completely besides the point. I'm convinced that a sizeable amount of the "location doesn't matter" people are just bummed that they can't pull in a SF salary and live like a king on a small SEA island.

mac01021 6y ago

You've overlooked the case where I want to live like a Jakartan in San Francisco, eating rice for breakfast, lunch, and dinner, and renting 50 square meters of living space. Take the minimum, over all cultures, of what would be taken as a comfortable lifestyle, and then assess the income required to maintain that lifestyle in various cities to see that, in a real sense, those cities do have different costs of living. That said, I believe the most sensible companies will not allow their HR/payroll departments to apply a standard cost-of-living formula, simply because there are bound to be prospective employees in Jakarta whose market values are higher than those of other prospective employees who happen to live in SFO and, as an employer, I'll want to hire all those people at their respective market values.