Basically, it says it's only useful to companies to decide what to pay their expat executives.
For the rest of us it's pretty much irrelevant. Normal people will change their consumption patterns according to their income and the local living cost. If you move from Rio to NY and then to Tokyo you'll probably settle for a smaller apartment each time.
But the index seems implausible even for its stated purpose. Let's say you're a "regular" person and are happy with x in NY; then you'll be very comfortable with 1.4x in Tokyo, and will live like a king in Rio with .85x. So what kind of stuff are execs consuming that makes those numbers equivalent?
Yes, these lists tend to be aimed at corporate expats with spouses and children negotiating with HR about their cost-of-living adjustments for overseas assignments. So you get a basket of goods that reflects that audience --- big flat in an expat-friendly district, private schools, foodstuffs which are available locally in NY but have to be imported in Shanghai, etc.
What Hacker News really needs is a list of cities ranked on minimum cost of living: how little can a foreigner spend on housing, meals, entertainment, etc. in a given city, without being in danger of crime, disease, ceiling collapse, frostbite, or an unstable internet connection? That figure is far lower in Shanghai and even Hong Kong than in New York ...
These charts are a thinly veiled ad for the publications for the Economist Intelligence Unit, which publish the full figures for quite a lot more money than you buy the Economist for. They are interesting, but if you really need the beef, well then you pay.
It depends on whom they surveyed. If they surveyed white collar workers and Western expats, the cost of living in Shanghai could very well be that expensive. If they surveyed migrant workers... no, it definitely is not.
Also, peg aside, the RMB has been strengthening in value over the past decade, and the Euro, I believe, has definitely gained against the dollar. So while NY may be expensive in the US, it is increasingly cheap when compared to certain other countries.
The best mix of price and quality of life I've found is Taipei, Taiwan. You can live very cheaply - cheap rent, the street food and convenience store food is remarkably good, cheap transit, lots of cheap access to technology, nature, art in the city and surroundings.
I was really blown away with the quality/price mix. I figure the government must be artificially keeping the Taiwan dollar down - I literally couldn't figure out any other explanation for why it'd be so cheap. The place is absolutely wonderful and I think has something to offer most people. I like Japan a lot, but Taiwan has 90% of the quality of the life, cleanliness, and conveniences at less than half the price. Worth checking out for anyone in the area, it's a city I could live in.
They're also pretty liberal about giving living/working permits, long term touring visas if you can prove you have funds, or letting you visa run as much as you want. Only downside is that visa waiver is only 30 days, but there's short hops to lots of interesting places nearby if you want another 30 days. Taiwanese people are generally pretty welcoming and it's easy to make friends there, too - highly recommended.
Yes, the government tries to keep price down for exporters. The BigMac index shows the BigBac exchange rate of the New Taiwan Dollar is around 23 NTDs = 1 USD, but the official exchange rate for the moment is around 32 NTDs = 1 USD.
The house price in Taipei can be as high as New York City in Xin Yi, DaAn districts. But generally the rent of an apartments in DaAn district for a 2000 sq ft doorman elevator building is around $1,600 to $2,000 USDs.
There drawbacks to live in Taipe. Although English is taught in schools, people still have problems to communicate in English. To be able to live like locals, you need to be able to speak Mandarin or Taiwanese dialect well enough, and be able to read signs in Engrish and guess what authors meant.
is Taipei behind the Great Firewall? What kind of price is normal for middle of the road livable apartment in a central location with a stable net connection and food / incidentals per month in your experience?
For the record, Sydney figure in my experience is about 2.5k AUD per month, Tallinn figure in my experience is about 900 AUD.
Frankfurt is a financial center and has a huge airport hub. Since these rankings are based around 'executive-level' compensation, these things make a major difference.
Anecdotally this seems true to me—when moving to London 4 years ago I was taken aback by the cost, but recent visits to my hometown of Sydney has also surprised me at how much it's "caught up" with London.
Bit surprised Moscow is lower than London—it cost the earth when I was there a couple of years ago.
In the article, Moscow's drop in price is attributed to the drop in the Rouble against the Dollar...this feels right to me also since Russia has been less openly aggressive recently, which would lead to a cheaper cost of living I guess.
While low expenses are a good thing, I've learned the hard way I'd much rather pay higher rent to live somewhere I am happy, than to halve my expenses and live somewhere not as nice.
On the other hand, I think I'd appreciate almost any of the cities on this list.
The fluctuation of the dollar has no impact if your entire income and expenditures are all in a different currency. But as others here mention, this kind of chart is mostly for "expats" living in a bubble.
Chicago is 36 and it has had its fair share of crime. Al Capone? Mayors that bulldoze operating airports in the middle of the night because they want to build a park there?
I'm with you. I'm in SF now but Chicago was home for a long time just a year ago. What's changed? It was on-par with Dallas with rents and overall cost of living.
That is with the glaring exception that Dallas has no income tax but a high sales tax. Chicago has both.
[+] [-] nandemo|16 years ago|reply
http://eiu.enumerate.com/asp/wcol_HelpIndexCalc.asp
Basically, it says it's only useful to companies to decide what to pay their expat executives.
For the rest of us it's pretty much irrelevant. Normal people will change their consumption patterns according to their income and the local living cost. If you move from Rio to NY and then to Tokyo you'll probably settle for a smaller apartment each time.
But the index seems implausible even for its stated purpose. Let's say you're a "regular" person and are happy with x in NY; then you'll be very comfortable with 1.4x in Tokyo, and will live like a king in Rio with .85x. So what kind of stuff are execs consuming that makes those numbers equivalent?
[+] [-] elai|16 years ago|reply
And it's very surprising that shanghai would be nearly as expensive as new york, a city that is already considered fairly expensive.
[+] [-] quant18|16 years ago|reply
What Hacker News really needs is a list of cities ranked on minimum cost of living: how little can a foreigner spend on housing, meals, entertainment, etc. in a given city, without being in danger of crime, disease, ceiling collapse, frostbite, or an unstable internet connection? That figure is far lower in Shanghai and even Hong Kong than in New York ...
[+] [-] bjelkeman-again|16 years ago|reply
[+] [-] rwhitman|16 years ago|reply
I think Wikipedia uses this one too. Apparently all these lists are flawed because they rate them against the dollar.
[+] [-] garply|16 years ago|reply
Also, peg aside, the RMB has been strengthening in value over the past decade, and the Euro, I believe, has definitely gained against the dollar. So while NY may be expensive in the US, it is increasingly cheap when compared to certain other countries.
[+] [-] lionhearted|16 years ago|reply
I was really blown away with the quality/price mix. I figure the government must be artificially keeping the Taiwan dollar down - I literally couldn't figure out any other explanation for why it'd be so cheap. The place is absolutely wonderful and I think has something to offer most people. I like Japan a lot, but Taiwan has 90% of the quality of the life, cleanliness, and conveniences at less than half the price. Worth checking out for anyone in the area, it's a city I could live in.
They're also pretty liberal about giving living/working permits, long term touring visas if you can prove you have funds, or letting you visa run as much as you want. Only downside is that visa waiver is only 30 days, but there's short hops to lots of interesting places nearby if you want another 30 days. Taiwanese people are generally pretty welcoming and it's easy to make friends there, too - highly recommended.
[+] [-] eugenejen|16 years ago|reply
The house price in Taipei can be as high as New York City in Xin Yi, DaAn districts. But generally the rent of an apartments in DaAn district for a 2000 sq ft doorman elevator building is around $1,600 to $2,000 USDs.
There drawbacks to live in Taipe. Although English is taught in schools, people still have problems to communicate in English. To be able to live like locals, you need to be able to speak Mandarin or Taiwanese dialect well enough, and be able to read signs in Engrish and guess what authors meant.
[+] [-] mrtron|16 years ago|reply
[+] [-] etherael|16 years ago|reply
For the record, Sydney figure in my experience is about 2.5k AUD per month, Tallinn figure in my experience is about 900 AUD.
[+] [-] paraschopra|16 years ago|reply
[+] [-] wmeddie|16 years ago|reply
Been thinking about this lately though, it looks like Tokyo is home to more Fortune 500 companies than any other city. http://en.wikipedia.org/wiki/Fortune_Global_500#2009_breakdo...
So it might be the best place for a B2B start-up.
[+] [-] sjf|16 years ago|reply
Why is Frankfurt ranked so high? It's not a capital city, and in general Germany is relatively cheap for Europe.
[+] [-] nagrom|16 years ago|reply
[+] [-] steilpass|16 years ago|reply
[+] [-] rms|16 years ago|reply
[+] [-] intranation|16 years ago|reply
Bit surprised Moscow is lower than London—it cost the earth when I was there a couple of years ago.
[+] [-] nagrom|16 years ago|reply
[+] [-] levesque|16 years ago|reply
[+] [-] antester|16 years ago|reply
On the other hand, I think I'd appreciate almost any of the cities on this list.
[+] [-] TeHCrAzY|16 years ago|reply
[+] [-] elai|16 years ago|reply
[+] [-] arihelgason|16 years ago|reply
http://www.google.com/finance?q=GBPEUR
[+] [-] delackner|16 years ago|reply
[+] [-] electromagnetic|16 years ago|reply
[+] [-] jrockway|16 years ago|reply
[+] [-] chipsy|16 years ago|reply
[+] [-] whatusername|16 years ago|reply
[+] [-] joss82|16 years ago|reply
[+] [-] JimEngland|16 years ago|reply
[+] [-] zachware|16 years ago|reply
That is with the glaring exception that Dallas has no income tax but a high sales tax. Chicago has both.
[+] [-] antidaily|16 years ago|reply