Distilling the wisdom of the crowd, one price at a time

Posted By Gerardo (gerardo@expatistan.com) on 15/01/2011

Crowdsourced cost of living index turns one year old

When Gerardo Robledillo decided to create Expatistan.com, he was essentially “scratching his own itch.” The Madrid native had already relocated his life within Europe four times in just six years, and whenever it came time to negotiate his salary with a new employer, Robledillo says he was “basically blind. I knew how much I was making in my current city, and I knew how much I wanted to make relative to my current income, but I had no idea how much that would translate to in the new city.”

Expatistan.com essentially allows users - potential expats - to compare the cost of living between cities around the world, and obtain a more detailed understanding of what kinds of expenses they would encounter on a daily basis if they were to move to a certain city.

The site collects the prices used in the comparisons from their own users. Expatistan.com encourages people from all over the world to chip in with information on local prices of various products and services.

One year after the launch, the project already has 68,000 different prices for 435 different cities. 17,500 different people, coming from 110 different countries, have contributed information to the project.

By the very nature of crowd-sourced projects, Expatistan.com is updated in real time and is self-correcting. Robledillo points out that even with all of the flaws that the crowd-sourcing method may bring, the end results seem to be well in sync with other cost of living indexes that exist.

“There really is wisdom in the crowd,” Robledillo says with a smile, “you only have to help the crowd to express it in a meaningful way”.

While big corporations like Mercer also provide cost of living data, Expatistan.com, put together on a shoestring budget, is a project that by relying in the selfless help of the crowd, can also offer reliable cost of living information, that is freely available and transparent.

“Expatistan.com may be the underdog - coded and run by a single person in his free time. It may have zero budget for marketing and research staff, but with the help and aggregated knowledge of thousands of people, it can compete with the corporations,” Robledillo points out.

See for yourself with the highlights from Expatistan.com's January 2011 cost of living index:

  • As of January 2011, Expatistan.com's cost of living index ranks Tokyo, Japan as the number one most expensive city in the world.
  • Following behind T
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Cost of life index for expats, Jan 2011

Posted By on 01/01/2011

Highlights about Expatistan

  • Launched in January 2010
  • Collaborative database of prices (crowdsourced, like Wikipedia). The website users enter the prices for their own cities. Therefore, not all of the 900+ cities contained in the database have data yet.
  • Uses Prague as anchor value (Prague = 100)
  • 65,000 prices entered in 429 different cities by 17,000 users coming from 110 different countries.
  • Compiles prices for 33 various products divided into 6 categories (Food, Housing, Clothes, Transportation, Health, and Entertainment).
  • The index shows only the cities that have enough data to be reliable. All cities are accesible in the application, though.
  • More information about expatistan:

Highlights of the Jan 2011 Cost of Life Index

  • As of January 2011, Expatistan.com's cost of living index ranks Tokyo, Japan as the number one most expensive city in the world.
  • Following behind Tokyo are Zurich, Oslo, Sydney and Perth. Australia also claims a third city in the top ten, with Melbourne at #6, followed by London, Singapore, New York City and Washington D.C. But Brisbane in Australia, though ranked 11th most expensive city, actually shares the same price index, 189, as Washington D.C.
  • The top 20 most expensive cities are dominated by Europe with 8 cities, Australia with 4 cities, while North America claims 3 cities, Asia has 3 with Tokyo, Singapore and Hong Kong, placing South America last with 2 cities in Brazil.
  • The world's cheapest city for expats, out of the 117 cities currently listed in the index is Ahmedabad, India, with a price index of 67.
  • Asia contains the biggest disparity, with the world's most expensive city, Tokyo and also the cheapest city, Ahmedabad, India.
  • South America's two most expensive cities rank in the top 20, and are both located in Brazil: Brasilia at #18 and Sao Paulo at #20. Brazil continues to represent South American again on the index with Rio de Janeiro at #43 and Curitiba at #66. However, Uruguay's capital, Montevideo shows up at #92, and Chile's capital city of Santiago follows right behind at #93.
  • Dubai, the UAE's first entry comes in at #51, while Africa's first two entries, Johannesburg and Pretoria, come in at #74 and #75, respectively.
  • An interesting commonality of the top 10 most expensive cities: all are located adjacent to one or more bodies of water.
  • In fact, the 8 US cities listed in the top 50 are also all wa
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