Value of money
Sunday, July 11th, 2010 01:58 am![[personal profile]](https://www.dreamwidth.org/img/silk/identity/user.png){kind=small}
afunaThinking about money a bit more. You can't just do a simple currency conversion of how prices would be back home and expect the amount to make sense in the other currency.
For example: back during my first job, when I was eating out regularly, I'd spend about 150 to 250 pesos per meal (~3.25 USD to 5.5 USD). That range is about correct for a decent sit-down restaurant meal -- any more than that was probably something fancy like sushi or salmon or really really cheap steak. At that, I was probably spending a lot more than some of my officemates, because you can get still yummy and way cheaper food for as little as a third of the price.
And the thing is, I have no idea how much the same would cost in a big city in the US, but my assumption is: more in absolute cash value, than it would back home. If I wanted to eat at the same price as I do back home, I think I'd have to stick to just fast food (I'm not going to try to eat for the same price as back home though!)
Which is to say that absolute prices mean nothing; it's the relative value of money (relative to the expected salary, relative to the cost of goods in the area, etc) that is important to figuring out how much to budget for a trip, and on that I'm completely lost *G*
I used to try to gauge the relative value of money by trying to compare the prices of necessary items to luxury items. Like, the cost of a decent cheap dinner to a mid-range expensive dinner. Or the price of a sandwich to the price of a shirt, or a book.
That worked for me in Thailand, which was on balance a lot like the Philippines, but was not so useful in Japan, where the food seemed unnaturally expensive no matter where I looked especially in comparison to electronics. (This may have been because I was in Tokyo). So I've been trying by other means to figure out how much a sum of money is actually worth in practical terms when travelling to other places. In Hong Kong, as in Japan, food was expensive, but electronics were (relatively) cheap. In both cases, when looking at a menu, I wouldn't be able to tell whether the food was cheap or expensive.
Money is hard :)
Thought experiment:
Let's say you saw a piece of money lying in a mud puddle. You know that the mud is clean (no feces, no insects, nothing spoiled or rotten, not smelly), and that no one owns the money so there's no moral obligation to return it. It's a quarter -- would you pick it up?
What if it were a dollar? five dollars? twenty? a hundred?
(It doesn't have to be mud, it could be somewhere slightly inconvenient like caught in a thorny bush where you can just reach it, but you'd need to be careful and do a bit of work.)
In terms of pesos, it would be for me:
one peso (approximately 0.02 USD) -- I'd just leave it there
20 / 50 pesos - leave it
100 pesos - borderline, maybe take it or maybe leave it
500 / 1000 (a bit more than 20 USD) pesos - take it
(there is no higher denomination)
Or, say you're in a restaurant, and you see two menu items that are similar in class, and differ slightly in price. You're willing to try either. At which point does the price difference become a factor?
Similar in class: say spaghetti vs carbonara; baked potato vs mashed potatos; sour cream and onion fries vs ... some other kind of fries; lasagna vs pesto; fried chicken vs something that tastes as good as fried chicken; pancakes vs waffles. So not something where the difference is really obvious, like steak vs fries.
I just made myself hungry :D
Anyway, if there were a dollar difference, would it matter? How about five dollars? ten? (I'd probably start reconsidering at 50 pesos, but again that's in pesos. My limit is higher when I try to think of it as dollars just because "1" feels less than "50", even though it's approximately the same -- and there lies the trap! *G*)
I shall be with other people so at least I don't need to worry about figuring out tipping conventions. (Whether to tip, how much, etc)
For example: back during my first job, when I was eating out regularly, I'd spend about 150 to 250 pesos per meal (~3.25 USD to 5.5 USD). That range is about correct for a decent sit-down restaurant meal -- any more than that was probably something fancy like sushi or salmon or really really cheap steak. At that, I was probably spending a lot more than some of my officemates, because you can get still yummy and way cheaper food for as little as a third of the price.
And the thing is, I have no idea how much the same would cost in a big city in the US, but my assumption is: more in absolute cash value, than it would back home. If I wanted to eat at the same price as I do back home, I think I'd have to stick to just fast food (I'm not going to try to eat for the same price as back home though!)
Which is to say that absolute prices mean nothing; it's the relative value of money (relative to the expected salary, relative to the cost of goods in the area, etc) that is important to figuring out how much to budget for a trip, and on that I'm completely lost *G*
I used to try to gauge the relative value of money by trying to compare the prices of necessary items to luxury items. Like, the cost of a decent cheap dinner to a mid-range expensive dinner. Or the price of a sandwich to the price of a shirt, or a book.
That worked for me in Thailand, which was on balance a lot like the Philippines, but was not so useful in Japan, where the food seemed unnaturally expensive no matter where I looked especially in comparison to electronics. (This may have been because I was in Tokyo). So I've been trying by other means to figure out how much a sum of money is actually worth in practical terms when travelling to other places. In Hong Kong, as in Japan, food was expensive, but electronics were (relatively) cheap. In both cases, when looking at a menu, I wouldn't be able to tell whether the food was cheap or expensive.
Money is hard :)
Thought experiment:
Let's say you saw a piece of money lying in a mud puddle. You know that the mud is clean (no feces, no insects, nothing spoiled or rotten, not smelly), and that no one owns the money so there's no moral obligation to return it. It's a quarter -- would you pick it up?
What if it were a dollar? five dollars? twenty? a hundred?
(It doesn't have to be mud, it could be somewhere slightly inconvenient like caught in a thorny bush where you can just reach it, but you'd need to be careful and do a bit of work.)
In terms of pesos, it would be for me:
one peso (approximately 0.02 USD) -- I'd just leave it there
20 / 50 pesos - leave it
100 pesos - borderline, maybe take it or maybe leave it
500 / 1000 (a bit more than 20 USD) pesos - take it
(there is no higher denomination)
Or, say you're in a restaurant, and you see two menu items that are similar in class, and differ slightly in price. You're willing to try either. At which point does the price difference become a factor?
Similar in class: say spaghetti vs carbonara; baked potato vs mashed potatos; sour cream and onion fries vs ... some other kind of fries; lasagna vs pesto; fried chicken vs something that tastes as good as fried chicken; pancakes vs waffles. So not something where the difference is really obvious, like steak vs fries.
I just made myself hungry :D
Anyway, if there were a dollar difference, would it matter? How about five dollars? ten? (I'd probably start reconsidering at 50 pesos, but again that's in pesos. My limit is higher when I try to think of it as dollars just because "1" feels less than "50", even though it's approximately the same -- and there lies the trap! *G*)
I shall be with other people so at least I don't need to worry about figuring out tipping conventions. (Whether to tip, how much, etc)
no subject
Date: 2010-07-10 11:16 pm (UTC)