Below is an excerpt of MilkyWayEconomy's 2020, best selling space economics book, "Blockchain & The Space Economy". We've decieded to release select chapters of the book as blog post because a) after reading it you'll run out and buy the book and b) despite being accidental VCs in Space we're really just nerds who want to share cool facts about Space with anyone willing to listen. Enjoy!
Chapter 35 - The Anatomy of a $1000 Burger
The economics of people willing to pay premium prices for meat in space, because it is so rare, should factor into the designs of future habitats. Mega satellites fashioned into cutting edge research Space labs in the future will need to keep workers happy and engaged. There are enormous positive psychological impacts of having a tasty and satisfying meal at the end of a long day of work. Rewarding people who work hard all day with delicious food is important to the success of firms and operations in Space to maintain workforce health and productivity. It is one of the reasons that NASA has a major kitchen operation and why as other firms operate more in Space they will also be concerned with food in orbit.
These mental benefits also extend to providing a feeling of home for astronauts and is why flowers have also been present on the ISS. Tending and caring for something external to self is good for the mental health of crew members. Also, a “walkabout”, as described in traditional Australian Aboriginal culture, and the Japanese practice of “forest bathing” [shinrin-yoku], have been shown to provide benefits to the psyche of people here on Earth. The good news is that larger commercial operations of farming in Space could also rent out time for mental health walks to people in need of being surrounded by greenspaces.
More immediately, the time spent close-up with plants harvesting crops to eat may provide some of these same psychological benefits in dedicated modules on space stations, the Moon or long duration journeys to Mars. Keeping people anchored mentally in the weightlessness of Space is critical to mission accomplishment.
Cows are Heavy and Space Hamburgers are Expensive
Cows are heavy and stress out easily. The first point might be obvious, but it is worth repeating, and as far as the second point you will have to take my word for it as someone who grew up on farms and around animals. Cows are also not useful as a food source in the same way that plants are. You cannot simply pick and eat a cow like you do a plant crop with no cooking and limited messy cleanup. Also, cows are competition when it comes to oxygen while plants on the other hand help recycle the carbon dioxide, we omit back into oxygen for us to breathe.
If you can’t send cows up into Space, then that means the price of a hamburger, meatball, or steak will be astronomically high on space stations, the Moon, or Mars. To dig into this a bit more ( as a huge lover of a good steak and burgers) let’s just start with the simplifying assumption that the cost of getting foodstuffs to where you're living in Space is about $1000/kg. Since 1kg is about 35oz and a good beef patty is about 6-to-7oz let’s just say it works out to about 6 per kg, thus putting the cost of just the patty at $170. Next, we have to consider how we are going to cook it. You are not going to fire up a grill in Space, but assuming you solve for that you are still going to want something to go with your Space beef patty. If this isn't intuitive, let's just go with fire in an air lock is bad and think of every Space movie you have seen involving a spark contacting oxygen. [Interesting to note is, the behavior of flames is currently being studied on the ISS and previous work by NASA led to the development of several fire-retardant materials, coatings, paints, and foams, many widely used today.] I don't see how simply using a microwave gets us to flame-grilled goodness, but science is a wonderful thing, and someone will solve for this if they haven't already.
Next, we have to consider the buns. Baking in Space is something that is both very interesting and important. Who doesn’t feel better after eating a warm slice of bread? The way the warm bread absorbs the butter slathered on top, and the crust is just a bit flaky still from just coming out of the oven. [I hope that was mildly tortuous to any of my high protein low carb diet friends.] Interestingly, it is the flakiness of the crust and the crumbs that come along with bread that is also a big concern of astronauts, and an important factor in why currently on the ISS astronauts are forced to eat tortillas. Several firms have conducted research on baking bread and even cookies in Space, which also has to overcome the challenges of not just the potential of fire, but also the effects of microgravity and finding a yeast that will work under those conditions. Not to mention the fact that, absent thermal convection to mix up air on the ISS, a super-hot pocket of air coming out of an oven would pose potential serious problems floating around the station. So, let’s just assume for a minute that you can easily purchase your burger with a delicious potato bun for another $80.
Putting the price of the beef patty, the bun, and some space lettuce, onions and tomato together you are likely looking at paying $300 just on input costs, and that doesn't include cheese or condiments. Cheese also has a long history in Space, including hitching a ride on the first SpaceX space capsule orbit back in 2010. Cheese comes from milk, which also comes from cows, and as mentioned before; they don't do well in Space, so this is likely an imported good from Earth to the kitchen at the Moon Cheers preparing your burger and fries. Last you have the rest of the costs associated with the restaurant in the Space hotel. If you look at the cost structure of menu items on a typical Earth establishment, you can see that only about a third of prices are input costs, and another two thirds comes from facilities and labor. Just using these as a proxy and giving us a bit of wiggle room in our estimate, you are at almost $1,000 (2019 USD) for a burger.
If this sounds like my attempt at burgernomics it is. Readers of The Economist might be familiar with the Big Mac Index, first introduced by Pam Woodall, which seeks to provide a measurement of purchasing power parity. If not, it is an insightful tool often used by economists to compare the prices of a similar basket of goods in different locations. For the Big Mac Index, it is looking at the basket of goods used to make a McDonald’s Big Mac and the cost paid in currencies in different countries for the sake of comparison. It is based on the law of one price, which is more of a concept than a law in economics that says that in a free market, absent friction, the price of the identical good must sell for the same price in different countries. Extending this a bit to Space is simple enough and applied to our estimations for the hamburger constructed above, we can see for example, that when compared to $5.67 for a Big Mac the difference is 175-times. So, does this mean that food, and by extension labor and facilities, will be 175-times more expensive in Space? Well, it provides a tool to start to think about it and to ask other questions to help frame our thinking. But what are you going to drink with your burger and fries?
About the Authors
George S. Pullen and Samson Williams are founders of Milky Way Economy, a Washington, DC based think tank who specialize in understanding the economic foundations of the Fifth Industrial Revolution and the Space Economy. In addition to writing, researching and being investors in 5th Industrial Revolution companies, Samson and George are adjunct professors at the University of New Hampshire School of Law and instructors at Columbia University in NYC. Additionally, George is a Marine (former) and guest lecturer at the National Defense University.