Meet the Starbucks Theory of International Economics

Daniel Gross at Slate has a theory: "The higher the concentration of expensive, nautically themed, faux-Italian-branded Frappuccino joints in a country's financial capital, the more likely the country is to have suffered catastrophic financial losses." Australia, the UK, and South Korea embraced Starbucks and are now facing financial crises. Egypt, Brazil, and Italy have few if any Starbucks outlets, and their banks are doing relatively well. (Trivia fact gleaned from Gross' article: There are only 3 Starbucks in Africa, and they're all in Egypt.) Manhattan has over 200 places to buy a venti cappuccino, and we all know how that town's major industry has been doing. And Gross does not have noticed, but we did: Can it be coincidence that WaMu, the Fortune 500 financial institution based in Starbucks' home town, has been wiped away like a foam mustache? We think not.

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By James in Miscellaneous on October 20, 2008 4:00 PM

Comments [rss]

ToasterDan

I think the exception to this rule is Canada. Toronto (Canada's financial center) has approximately 100 Starbucks and Canada also has the world's soundest banking system.

Troy Morris

I think that it's an interesting theory to banter about, in an un-educated manner. As the educated manner is boring and filled with numbers and big words that nobody really understands.

But what doesn't come across clearly in this post is that it's the presence of Starbuck's is an indicator of the mentality of that economy.

I prefer this quote:

aving a significant Starbucks presence is a pretty significant indicator of the degree of connectedness to the form of highly caffeinated, free-spending capitalism that got us into this mess.

While tongue in cheek (as he notes Chile has a ton of Starbucks, but is doing well), he is mostly rallying against de-regulated, immature, irresponsible and dangerous economic practices.