Cultural Economics

by Heather Pubols

Cultural Economics

May 6, 2013

When we moved to Africa four years ago, I took my first real trip through the grocery store to look for items that I actually needed for our home. The store near where we lived had an amazing variety! You could buy everything from a loaf of bread to a new kitchen table and everything in between.

There were lots of similarities between my shopping experience there and in the United States, but one difference that I didn’t anticipate was prices. It was a lesson in cultural economics. I remember picking up a medium box of corn flakes, doing the currency conversion, and discovering that it would cost me almost $10 USD compared to the $3 I’d probably pay at home. On the other hand, I remember visiting the butcher and discovering that we could buy a nice piece of beef filet for less than it would cost at home. We began to see this with all kinds of other things, too.

Economies are cross-cultural, too

I had to throw out my presuppositions about how much something should cost. The overall buying power of the country based on wealth and population, cultural values, available local products versus imports, and taxes – all impact local prices. I guess before living in an African country, I had the idea that if a country had less wealth, then products would be cheaper. What I learned was that while labor for services was often less, products (especially those requiring some kind of manufacturing or requiring import) were usually more expensive and fewer people could afford them. The supply is less because the demand is less, so the price is higher.

Understanding the cost of living where you live is important as you budget your funds. The 2012 results from a cost of living survey show that 13 African cities are in the top 50 most expensive cities in the world!  Luanda, Angola, in southern Africa, was listed as number two with one of the highest housing costs in the world (higher than Paris and New York City). Constantly changing currency exchange rates add another complication

Explaining economic differences can be a challenge

When missionaries travel abroad, it can sometimes be difficult to adequately explain differences in expenses between where they serve and where they are from to their financial support team. Some donors may feel that the missionary needs to raise too much money for the location they are going to. Or, maybe something that is very inexpensive where a missionary serves seems extravagant to a donor because it is expensive in the missionary’s home country.

It’s important to remember that every economy functions differently. Each needs to be evaluated from within its own context. Thankfully, many missionaries have financial advisors that help them construct budgets to compensate for these differences. However, even with advice the reality of the economy in a new place can still seem very strange at first.

As you’ve traveled abroad, what expenses have surprised you? What has been more or less than you expected?

About Heather Pubols
Heather and her husband, Jeff, have been serving in missions using their skills in communications and computers for more than a decade. Professional communicators serve a vital role in keeping the global church informed about how God is at work around the world. Computer technicians help keep their missionary colleagues able to perform their work without technical hindrances. Heather and Jeff are thrilled to be able to use their gifts to help further the spread of the gospel.

Category: Missionary Minded