Someone (Noah?) pointed me to an article on the Big Mac Index a few days ago, and I was about to post on how the concept is fundamentally flawed, but I couldn't find the link, so I Googlesearched and found the original article, which basically makes my argument for me.

But anyway, what I was going to say was even if you make the simplifying assumption that the capital cost to produce a Big Mac is the same everywhere, the different price of labour in different places means that the Big Mac should vary in price. It costs far less to hire a Chinese worker than a Swiss one, so the Chinese Big Mac should be cheaper.

A more useful statistic might be how many Big Macs an average McDonalds worker could buy with his/her hourly wage. But then again, wages might be so low as to lead to the conclusion that the Yuan is overvalued, which it seems none of the experts would agree with. The best would probably be a CPI-type basket, but that's complicated.