EachDigital Nomad Visa features some basic Country Metrics and one of our favorites is the Cappuccino Index. Why do we need a Cappuccino Index?
Well, when you are traveling to a country for holidays, the cost of living there is not as big of a factor as when you move there. When on holiday, you would most likely treat yourself and splurge a bit, after all, it’s just a short break. However, if you travel and move between countries as a digital nomad the cost of living in that country becomes quite a big factor. So not only, you need to pick a good Digital Nomad Visa, but also one of the main things to consider is the cost of living in the country that you are considering moving to.
Cost Of Living Index lets you compare average prices in the country, they are great but they are complex. Is there a simple way to compare it by just comparing the cost of one single product? Yes, maybe…
Why the Cappuccino Index?
The premise of the Cappucino Index, is loosely based on the idea of The Big Mac Index (see below) but it is a much more simplified version, that aims to directly compare the price of a regular cappuccino in various countries using the average cappuccino price converted to USD based on the data from Numbeo, Cost of Living Index data.
The Cappucino Index creates an interesting comparisonand overview but let’s be honest, it needs to be taken with a pinch of salt, as it is based on a number of assumptions. First of all the data is user-driven and relies on exchange rates set by Numbeo. Also, who are we to say that a ‘regular cappuccino’ is the same size? It can very much vary per country. That said, the Cappuccino Index can still be a fun and compelling overview of the prices of a particular type of coffee in various countries.
Why Cappuccino?
Oh, well! That is simple! Aren’t we all in love with our milky coffees? Well ok, we are just making a massive assumption here, speculating that plenty of Digital Nomads are hipsters at heart who can’t put their cappuccinos down! We have no data to support it just our experience from the road. And even that is a stretch! Is it just us, who travel with our Nespresso??? Oh, what can I say, it gives us consistency in a very inconsistent life of a Digital Nomad.
Cappuccino Price per Country
Check out the regular Cappucino Prices for each country that has a Digital Nomad Visa.
About the Data
Numbeo is the largest database of user-contributed data about the cost of living in cities. These indices are historical and are published periodically. They are a snapshot of the current indices at a specific point in time. The latest data used is from the 2021 Mid-Year Cost of Living Index by country.
What is the Big Mac Index?
The Big Mac Index is a brilliant idea that takes its name from the Big Mac, a hamburger sold at McDonald’s restaurants. It is a method of predicting exchange rate movements. Back in 1986, The Economist invented The Big Mac Index, a lighthearted guide to whether currencies are at their “correct” level. It is based on the theory of purchasing-power-parity (PPP), the notion that in the long run exchange rates should move towards the rate that would equalize the prices of an identical basket of goods and services (in this case, a burger) in any two countries.
You can learn about The Big Mac Index on The Economist website.
Last updated September 23, 2022.
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