>My favorite example is the comparison with Denmark, where the hourly wage of the mac worker is more than double yet the big mac price is pretty much the same.

>My favorite example is the comparison with Denmark, where the hourly wage of the mac worker is more than double yet the big mac price is pretty much the same. Who would have guessed... Not me! Can someone explain this to me? I worked in a restaurant for 5 years. It's a notoriously tight-margin industry, the poster child for late stage capitalism. We aimed for labor costs of ~30%. If we doubled wages, holding margins constant, we'd have to charge 30% more. Another ~40% goes to ingredients- I don't know what their labor percentage is, but conservatively assuming 20%, that's an additional 8% if they doubled wages too. If we let margins go to zero (they do have to be non-zero to incentivize opening a restaurant at all, but can be arbitrarily small), we're still a minimum of 28% more expensive. But even if we ignore all of that, the US notably subsidizes beef to a large degree. If we had salary parity with Denmark, I'd still expect the US Big Macs to be cheaper. And that's all before factoring in Denmark's higher taxes. So what gives? Does McDonald's have wider margins or a lower labor percentage than the rest of the industry? Does Denmark also subsidize beef?