By Dalal Street Investment Journal (DSIJ)
What do burgers, lipsticks, underwear, and buttered popcorn have in common? They can all offer clues about the economy. These unconventional indicators show how consumer behaviour changes in good times, uncertain phases, and difficult periods.
Economic headlines often feel contradictory. One day, you hear that the economy is booming. The next day, someone says things are getting worse.
Take India’s current situation. For the ongoing financial year, the country’s nominal GDP is now estimated at around ₹345 lakh crore. Real GDP also grew 7.8% in the third quarter of FY 2025–26, according to the Ministry of Statistics and Programme Implementation.
Unemployment has fallen significantly over the past several years. In December 2018, it stood at 9.7%, but by December 2025, it had dropped to 4.8%. Inflation has followed a similar downward path. It declined from 4.06% in January 2021 to 2.75% by January 2025.
On paper, those numbers look strong. Yet public conversations about the economy often sound pessimistic. One reason is that traditional indicators like GDP, inflation, and unemployment only show the big picture. They don’t always capture how people experience the economy in their daily lives.
That’s where unconventional indicators come in. Some of these indicators sound strange at first. A few even sound funny. But they reveal surprisingly useful insights.
Before we move ahead, let’s first understand what are unconventional economic indicators.
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Unconventional economic indicators are unusual signals that people watch to understand how the economy is really doing, beyond the standard data such as GDP, inflation, or unemployment.
Think of them as everyday clues. Sometimes official numbers take time to come out and may not fully capture what is happening on the ground. Unconventional indicators help fill that gap. They show changes in consumer behaviour, business activity, or public mood in a more practical way.
These indicators are called unconventional because they are not part of the usual set of economic measures published by governments or central banks. They are more informal, but they can still be useful when studied carefully.
That said, they should not be used alone. A single unusual indicator cannot explain the whole economy. But when combined with official data, they can offer a clearer and more human picture of what is changing in real life.
In simple terms, unconventional economic indicators are the small, often overlooked signs that help us understand the bigger economic story.
Here is a list of unconventional economic indicators worth watching
Comparing currencies across countries is not simple. A dollar might buy far more goods in one country than in another. This difference is known as Purchasing Power Parity (PPP).
Tracking PPP normally requires a complicated process of analysing a huge basket of goods and services. But, in 1986, The Economist came up with a simpler alternative, the Big Mac Index. It is a price index that shows the cost of a Big Mac across more than 50 countries and currencies.
The idea is straightforward. If economies were perfectly balanced, the same burger should cost roughly the same worldwide once exchange rates are considered.
Here is a little insight into the Big Mac Index by Country (2025):
Country | Big Mac Index 2025 (US $) | Big Mac Index 2024 (US $) |
United Kingdom | 5.73 | 5.90 |
Canada | 5.43 | 5.52 |
Australia | 4.87 | 5.06 |
Japan | 3.11 | 3.19 |
India | 2.62 | 2.75 |
Egypt | 2.69 | 2.47 |
The Maharaja Mac, which is the closest alternative to the Big Mac in India, costs roughly $2.62. In the United States, the burger costs roughly $5.79.
Using these prices, we can calculate the implied exchange rate.
Implied exchange rate = Price of Big Mac in India ÷ Price of Big Mac in the US
Implied exchange rate ≈ ₹218 / $5.69 ≈ ₹38 per dollar
Now compare that with the actual market exchange rate, which is ~₹92 per US dollar, at the moment.
The gap between these two numbers is what produces the –58.7.% undervaluation estimate for the Indian rupee in the Big Mac Index.
The comparison implies that the Indian rupee may be considerably undervalued against the US dollar when viewed through burger prices.
In simple terms, many goods and services cost far less in India than they do in the United States. Wages are lower. Operating expenses are also smaller. Differences in purchasing power help widen that gap even further.
Of course, a single burger cannot represent an entire economy. But it offers a surprisingly clear snapshot of how currencies and living costs compare globally.
When economies slow down, people don’t necessarily stop spending altogether. They simply change what they spend on.
This behaviour inspired the Lipstick Index. The idea was introduced by Leonard Lauder, chairman of Estée Lauder, during the 2001 recession in the United States. While overall consumer spending weakened after 9/11, lipstick sales increased by 11%.
Why would cosmetics sales rise during difficult times? Because people often substitute large luxury purchases with smaller indulgences. Instead of buying expensive jewellery or designer clothes, they opt for something affordable that still feels like a treat.
The pattern has appeared repeatedly in economic history:
During the Great Depression, cosmetics sales rose by 25%.
During COVID-19, skincare sales in India increased by around 10%.
Today, economists apply the concept to the broader beauty industry, including skincare, perfumes, and personal grooming products.
It reflects that even when money is tight, people still look for small comforts.
In the 1920s, economist George Taylor suggested that skirt lengths moved with the economy. When economic conditions were strong, hemlines rose. When times were difficult, skirts became longer.
Later research attempted to test the idea. In 2010, Marjolein van Baardwijk and Philip Hans Franses published an economic study examining the relationship between skirt lengths and economic conditions. Their analysis looked at hemline data from 1921 to 2009 and found that positive economic conditions were followed by shorter skirts three to four years later.
There are a couple of explanations behind this pattern.
First, fashion trends often reflected consumer confidence. In prosperous periods, many women wanted to show off fashionable stockings, which led to higher hemlines. The flappers of the 1920s famously wore knee-length skirts. The economic boom of the 1960s popularised the miniskirt. Meanwhile, the Great Recession saw a return to longer styles such as midi and maxi dresses.
Second, there was a practical reason. When the economy was booming, yarn and textile prices often went up. Designers sometimes responded by shortening skirts so they could use less fabric.
But the pattern wasn’t always reliable. In some prosperous periods, skirts actually became longer. The 1950s are a good example.
Fashion cycles have also sped up in recent decades. Since the mid-2000s, social media, online retail, and new production technology have pushed trends to move much faster.
The Great Recession also reshaped the industry. It encouraged minimalist design and pushed many brands toward direct-to-consumer sales. Meanwhile, digital platforms changed how trends spread and how people shop.
In India, the idea becomes even more complicated. The country’s fashion landscape includes saris, salwar suits, lehengas, western wear, and much more. Hemlines alone cannot capture such diversity.
Still, the index remains a fascinating example of how economists try to connect consumer behaviour with economic moods.
When times are uncertain, entertainment becomes an escape. That’s the premise behind the Buttered Popcorn Index. It suggests that people tend to spend more on affordable entertainment, like movies, when the economy slows.
In India, between 2018 and 2020, economic growth slowed noticeably. GDP growth dropped from 6.8% in 2018–19 to 4.5% in Q2 FY20, and unemployment climbed.
Yet cinema attendance remained strong. In fact, three blockbuster Hindi films collectively earned around ₹120 crore on a single day in October.
In 2009, while much of the world economy was struggling, cinema spending proved relatively resilient. Global cinema ticket sales grew by 7.6%, with the Asia Pacific region recording the strongest growth, as per Reuters
Something similar happened during the pandemic. With cinemas closed and outdoor activities restricted, streaming platforms exploded in popularity. India’s OTT industry saw a 30% jump in paid subscribers between March and July 2020.
Even during economic stress, people still want entertainment. So, consumers move away from expensive leisure activities and gravitate toward forms of entertainment that offer the most value for the lowest price.
The Men’s Underwear Index, discussed by former US Federal Reserve Chairman Alan Greenspan, is based on a simple observation. Men tend to delay replacing basic clothing items (like underwear) when finances are tight.
If sales drop, it could indicate financial stress. When sales rise again, consumer confidence may be returning.
Historical data has occasionally supported the idea.
During the 2008–2009 financial crisis, men’s underwear sales fell noticeably before recovering in the following years.
From 2009 to 2016, sales across North America increased by roughly $1.1 billion.
The pattern appeared again during COVID-19. Several innerwear companies reported weak sales growth or even declines.
However, modern retail trends complicate things. In India, online innerwear sales grew more than 80% in FY24 compared to FY23, suggesting that shopping behaviour, not just economic conditions, can influence the numbers.
Still, the index remains one of the most amusing economic signals ever discussed.
Economic data tells us a lot, but it doesn’t tell us everything. Indicators like GDP, inflation, and unemployment remain the foundation of economic analysis because they track production, prices, and jobs. They show the structure of an economy. Yet numbers alone rarely capture how people actually feel.
A burger’s price. A spike in lipstick sales. Fewer underwear purchases. Even busy movie theatres. These small signals reflect everyday decisions, and those decisions often reveal shifts in consumer mood before they appear in official statistics.
None of these measures can replace traditional economic data, and they were never meant to. But they offer a different perspective.
So the next time someone claims the economy is doing great or terrible, it may be worth looking beyond the usual charts. Sometimes the real signals appear in the most unexpected places.
SEBI Registered Research Analyst (INH000006396).
Founded in 1986, Dalal Street Investment Journal (DSIJ) brings decades of experience in India’s equity markets. DSIJ's research combines fundamental analysis with price action, guided by disciplined risk management and capital preservation. They follow a structured, data-driven approach designed to help investors and traders make informed decisions beyond short-term market noise.
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