4 ms·

This seems like a short-term advantage, but a long-term liability - wouldn't a massive wage disparity simply encourage emigration/brain drain? Great for the st

• rdl 13y ago
  The thing about Berlin is costs of living are low and people want to move there for reasons unrelated to the economy (it is probably the world's best party/club/edm/etc. destination). There are huge numbers of 15-35 year olds who would take a 50-75% paycut and ~25-50% effective QoL decrease (in material terms) to live in Berlin vs. London or USA. I think it's the same with Israel -- Israeli tech guys would generally make 4x as much money and live 2x as well if they moved to the USA, but they have their own non-economic reasons for actually wanting to live in Israel, and then make Israel into an awesome startup place. This has been a key factor in several M&A deals, companies setting up in-Israel labs, etc.
  • martinald 13y ago
    This is a really great point. And not only 'would' take a 50-75% paycut - they already do this en masse. Another thing that is important is the ridiculously low rent. Seems to be ~75% cheaper than London. Many people in London/NY/SF/SV pay a whopping proportion of their salary into rent, so if you take a €2k/month paycut but end up spending the same amount less in rent, everyone's winning. As nearly every startup hub is really struggling with insane rents, Berlin could be a serious competitor here. I think Berlin's property market will have enough slack to take on a fair bit of population growth, too.