A Big Mac costs a little more in American cities than in the countryside, and inflation can blow that gap wide open. When prices surged in 2023, urban Big Macs ran about 9.5% above nearby rural ones, up from roughly 1% a decade earlier.
The study is by Fernanda Alfaro, Scott Loveridge, Dusan Paredes and Mark L. Skidmore, economists at Michigan State University, with Paredes also at Universidad Católica del Norte. It was published online in the Journal of Regional Science on September 3, 2025.
Economists use the Big Mac because it is the same product everywhere. Rural areas are usually missing from US price surveys, so the authors collected their own prices.
Phone calls, then web scraping
In 2014 and 2015, a period of low inflation, the team phoned 3,194 McDonald’s restaurants, 71% of them urban. For 2023 and 2024, a period of high inflation, they scraped prices every two weeks from 8,432 restaurants.
For each rural restaurant, they compared its price with the average of the five closest urban McDonald’s. They then linked those gaps to county wages, unemployment, housing prices, population, the quality of rural roads, distance to urban stores and the number of nearby McDonald’s.
The gap narrows, but not evenly
The average urban premium was 1.0% in 2014 and 0.8% in 2015. It rose to 9.5% in 2023 at the peak of inflation, then dropped to 1.3% in 2024 as inflation slowed.
Over the long run, from 2014 to 2024, rural and urban prices moved closer together. The surprise was timing: gaps closed faster in the low inflation years than in the high inflation ones. The authors had expected the opposite, since frequent price changes should help prices align. In 2023 and 2024, rural prices actually rose faster than urban ones.
What drives the difference
Across both periods, better rural roads were linked to smaller gaps, while higher urban housing costs and greater distance from urban stores were linked to larger ones.
The drivers shifted with inflation. In the calm 2014 and 2015 period, road access and competition mattered most. In 2023 and 2024, production costs took over: the urban-to-rural wage gap was the strongest predictor, followed by land costs and distance.
The authors note that their method compares each rural store with its closest urban neighbours, so the gaps they report are likely a lower bound.
Many McDonald’s restaurants closed after the pandemic, especially in rural areas, yet the team still tracked 1,488 restaurants that had been operating since 2014 all the way through 2024.
Study Details:
- Title: Explaining the Big Mac Urban-Rural Price Gap in the United States
- Authors: Fernanda Alfaro, Scott Loveridge, Dusan Paredes, Mark L. Skidmore
- Journal: Journal of Regional Science
- Publication Date: September 3, 2025
- DOI: 10.1111/jors.70022