Does Drinking More Coffee Slow Down Your Economy?

Reading Time: 6:35 minutes

Have you ever wondered – while sipping on that first cup of coffee to kickstart your day – whether coffee consumption actually fuels your country’s economic growth by increasing the productivity of coffee-drinkers like you? Especially on late nights when those cups of coffee become so indispensable at keeping you awake so you can meet your boss’s 15 deadlines?

A few of us from the marketing department got into this debate with our colleagues from the legal department. Apparently, everyone in legal is a tea-drinker (ugh) and speculates otherwise. They postulate that although coffee may help wake us up in the morning and keep us up for the occasional overtime, it probably does more harm than good if we regularly depend on coffee to keep us working late into the night.

The toll it takes on the general health of coffee drinkers, they claim, would probably hold back the country’s economy more than those occasional little boosts in productivity. They argue that tea gives more long-term benefits, and that it will slowly and steadily grow a country’s GDP.

Over-caffeinated nations = sluggish economy?

So instead of speculating on our own respective hypotheses, we decided to let the data be the jury. The loser’s department would have to drink the winner’s beverage of choice for a month.

With some teamwork, the marketing department managed to dig out some coffee consumption data for the countries in our region from the International Coffee Organisation, while Legal rustled up the GDP data for these countries from the World Bank. We then put the data through the grinder using SAP Analytics Cloud.

The first two charts we churned out weren’t particularly useful as they only showed the total consumption of coffee from 2008 to 2017 for each of the six countries we randomly selected, as well as their respective GDPs.

The first chart did give us a good idea of how much coffee each of these countries consumed each year for the entire decade. Japan came out tops ahead of Indonesia, the Philippines, India, Vietnam and Thailand. We had always thought Japan was more a (green) tea-drinking country. Minus one point for Legal.

coffee consumption

The second chart didn’t throw up any surprises as we were all familiar that Japan was the economic juggernaut in the group with the highest GDP, followed by India, Indonesia, Thailand, the Philippines and Vietnam.

GDP

We also did up a map to show total coffee consumption (larger dots mean more coffee).

map

Our first attempt at merging the data was to plot the coffee consumption of each country against its GDP in the decade being examined. The chart came up so congested it was difficult to discern any clear trends from the plots.

summary percentage

So, we decided to use the average data for the last 3 years and compare them to the corresponding growth in GDP using percentage comparisons rather than the absolute amount.

percentage change average

We then zoomed into individual countries for a closer look. This was when those pesky lawyers triumphantly pointed out the charts for India and Indonesia. For both countries, the GDP growth increased even as the growth in coffee consumption fell. Perhaps drinking less coffee was indeed counterproductive for economic growth after all!

India

Indonesia

However, the chart for Japan told a different story. The plot showed a clear correlation between the growth in coffee consumption and GDP growth. As the growth in coffee consumption picked up pace, GDP growth also increased. Points for us this time!

Japan

The other countries didn’t really show any strong correlation between coffee consumption and GDP growth.

So, we were in a bit of a stalemate. The growth in coffee consumption corresponded with a period of increasing GDP growth for Japan, yet corresponded with a fall in GDP growth for other countries. So perhaps we were both wrong! Might it be possible that, in reality, how much coffee a country drinks has no bearing on the country’s economic prowess?

In the face of the “evidence” furnished by the simple data analytics, both Marketing and Legal conceded we could not arrive at any meaningful conclusions about our whimsical hypothesis. We went out and bought each other beer – a drink we all agreed keeps everyone sane – and decided to look for tea data the next time.

Learn more about how you can derive meaningful insights using real-time data. Get a free trial of the SAP Analytics Cloud here.

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