Out of Control Policy Blog

McDonald's as an engine of economic development

With all the criticism of fast food and their companies in recent years, it's nice to see some nuanced research on the economic value of these companies. This article on the benefits of McDonald's to developing nation economies is one of the most downloaded articles from the academic journal, the Global Economy Journal. Here's the abstract:

McDonald's -- Much Maligned, But an Engine of Economic Development
Adrian E. Tschoegl, Wharton School of the University of Pennsylvania

Abstract
Critics have excoriated the US fast-food industry in general, and McDonald's most particularly, both per se and as a symbol of the United States. However, examining McDonald's internationalization and development abroad suggests that McDonald's and the others of its ilk are sources of development for mid-range countries. McDonald's brings training in management, encourages entrepreneurship directly through franchises and indirectly through demonstration effects, creates backward linkages that develop local suppliers, fosters exports by their suppliers, and has positive external effects on productivity and standards of service, cleanliness, and quality in the host economies.
Recommended Citation
Tschoegl, Adrian E. (2007) "McDonald's -- Much Maligned, But an Engine of Economic Development," Global Economy Journal: Vol. 7 : Iss. 4, Article 5.
Available at: http://www.bepress.com/gej/vol7/iss4/5

Samuel Staley is Research Fellow


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