Some people think it is absolutely brilliant that McDonald’s is packing up its Big Macs and leaving Iceland.
They fail to see the big picture.
Crap burgers and awesome milkshakes aside, an operating McDonald’s in a country is a sign of active participation in a global community.
It is surely no coincidence that McDonald’s arrived in Iceland at the dawn of Iceland’s participation in the EEA. And it is surely no coincidence that McDonald’s is leaving in wake of the economic crisis.
While some might see the golden arches as an evil part of globalization, the larger implications should not be ignored. Having some uniformity worldwide is beneficial to compare the real economic and political situations of countries.
The McDonald’s Theory of conflict prevention
What is it about McDonald’s that creates peace? The simple answer is that a country that has stabilized to the point where someone is willing to invest close to a million dollars per store in a franchise operation is very unlikely to be a threat to its neighbors, or have neighbors who are a threat to it. McDonald’s restaurants are owned by the mother corporation, or by individual franchisees. Neither one is interested in seeing riots, corruption nor banditry destroy their investment. American towns and other countries have to earn their McDonald’s.
The Big Mac Index
The Big Mac Index is published by The Economist as an informal way of measuring the purchasing power parity (PPP) between two currencies and provides a test of the extent to which market exchange rates result in goods costing the same in different countries.
The peace theory has been under fire, pardon the pun but the Big Mac Index has been indicative of economic trends. So Ronald McDonald’s decision to give up on Iceland is actually a sign of how royally messed up things have become. Some people are talking about positive effects on culinary culture in Iceland.
But the thing is that we didn’t chase McDonald’s out of the country, McDonald’s decided to leave us. If it had been the other way around then maybe we’d be seen in a similar positive light as Jose Bové and the French farmers who have protested the restaurant’s ethics and effects on cusine. But McDonald’s packing its bags leaves us as the village idiots of the world.
They just don’t see it feasible in the long run to conduct business in this country.
And that is no laughing matter, whether you like their burgers or not.
Note: McDonald’s in Iceland is a franchise operated restaurant. We might just be witnessing the classic case of an Icelandic business so in debt that it must re-organize or die. We will see whether a new player sees the opportunity to bring the golden arches back into the market. With import costs and tariffs the way they are, and McDonald’s importing most of their supplies it should be interesting to see how this plays out.
See also:
Iceland is so messed that McDonald’s is giving up and going home
McDonald’s closes in Iceland after krona collapses
Iceland to be McDonald’s free