To elaborate further, these numbers aren't raw as you would call it, they are adjusted for local prices of goods, food, necessities(electricity etc.). Do you believe the IMF or does Russia have some numbers we don't know?
Disclaimer: I hope you guys can read latex 'code', because it seems not to render properly... Hope that is not an issue.
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Relative purchasing power is defined as the real exchange rate, R, not changing.
The formula for R is $R = \frac{E* P_W}{P}$
I came up with a line of reasoning where E needs to change to $\frac{\pi}{\pi_W}$, whereas my textbook says E needs to change according to $\pi - \pi_W$.
What is it? What would be wrong with my train of thought below?
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$$
\begin{aligned}
R = \frac{E* P_W}{P} \\
R_{t+1} = \frac{E_{t+1} P_{W, t+1}}{P_{t+1}} \\
E_{t+1} = E_t * k_1 \\
P_{W, t+1} = P_W* k_2 \\
P_{t+1} = P_t * k_3 \\
\end{aligned}
$$
If $k_1 = k_2$, then the factors k, would cancel out, leaving $R$ unchanged.
If $k_1 > k_2$ such that: $R_{t+1} = \frac{E_{t+1} P_W * k_2} {P_t * k_3}$, then $k_1 * k_2 = k_3$ for them to cancel out again. Thus, the following must hold $k_1 = k_3/k_2$ for the $k_i$'s to cancel each other out again and thus, leaving $R$ unchanged.
My bet, I think it would be Switzerland or Belgium, but it would be interesting to hear what you guys and gals know.
Asking as I want to get a job in a european country with the highest PPP, to then save and make investments in other countries far quicker.
Whats the difference?
Relative PPP states that change in exchange rates should offset price effect of any inflation differential of two countries.
Uncovered interest parity derives the expected future spot rate.
Seems like they both expect country with higher interest rates to depreciate.
EDIT: nevermind figured it out… its inflation for relative PPP and uncovered interest rate is based on interest rate not inflation rate
Imagine from a stated preferences survey of individuals from several nations, I have samples of people’s willingness to pay for something. If I regress willingness to pay against household income (assessing whether income determines payment amount) , and my survey adjusts the suggested amounts by purchasing power parity, do I also need to adjust household income? It seems I’ve relativized the responses to address the differences among respondents by the nation they come from.
Basically the title.
And what do people mean when they say one currency is "stronger" than another?
>Indians are among the most overworked workers globally while earning the lowest minimum statutory wage in the Asia-Pacific region, barring Bangladesh.
>> India ranks fifth in the world among countries with long working hours, often stretching up to 48 hours a week, if not more. Only Gambia, Mongolia, Maldives and Qatar, where a quarter of the population is Indian, have average working hours longer than in India.
>>>An average worker in China works 46 hours a week, 36 hours in the United Kingdom, 37 hours in the United States and 36 hours in Israel.
The federal minimum wage for covered nonexempt employees is $7.25 per hour.
In India, 139.85 INR will allow you to buy the same things you'd buy with 7.00 USD in United States. In India, 108.35 INR will allow you to buy the same things you'd buy with 4.35 GBP in United Kingdom.
In 2013 annual median per capita income in India stood at $616, tripling that gives us $1848.
The median annual earnings for full-time employees in the United Kingdom was approximately 31.46 thousand British pounds in 2020.
The Bureau of Labor Statistics reported a median personal income of $865 weekly for all full-time workers in 2017.
Purchasing power parity is the idea of pricing items at an variable but equitable price for different people based on their geographic location. For example, an item priced at $100 USD would need to be priced at $50 USD for a person in Brazil for both people to be paying an equal price based on PPP.
Parity Panda is a website plugin that would automatically provide eligible visitors with a discount code based on the visitors geographic location and their region’s purchasing power parity rate.
Because Parity Panda is a simple JavaScript plugin it can easily be added to most hosted website solutions such as Wordpress, Squarespace, Wix... etc. Discount codes could be automatically be generated for common payment solutions such as PayPal, Square, or Stripe, and users can always manually upload discount codes for any other provider.
Users will be able to set minimum and maximum discounts so as not to discount beyond profitability. Parity Panda would provide an eligible website visitor with the closest matching discount code without giving over.
I basically want to compare the difference in cost of living between states, but the results I get on google are vastly different from source to source.
How are international comparisons of income and purchasing power parity (PPP) made?
They compare a basket of goods, but how does that work when the goods are different?
How do you compare a mud hut in Africa to a house in the US?
>Indians are among the most overworked workers globally while earning the lowest minimum statutory wage in the Asia-Pacific region, barring Bangladesh.
>> India ranks fifth in the world among countries with long working hours, often stretching up to 48 hours a week, if not more. Only Gambia, Mongolia, Maldives and Qatar, where a quarter of the population is Indian, have average working hours longer than in India.
>>>An average worker in China works 46 hours a week, 36 hours in the United Kingdom, 37 hours in the United States and 36 hours in Israel.
The federal minimum wage for covered nonexempt employees is $7.25 per hour.
In India, 139.85 INR will allow you to buy the same things you'd buy with 7.00 USD in United States. In India, 108.35 INR will allow you to buy the same things you'd buy with 4.35 GBP in United Kingdom.
In 2013 annual median per capita income in India stood at $616, tripling that gives us $1848.
The median annual earnings for full-time employees in the United Kingdom was approximately 31.46 thousand British pounds in 2020.
The Bureau of Labor Statistics reported a median personal income of $865 weekly for all full-time workers in 2017.
How are international comparisons of income and purchasing power parity (PPP) made?
They compare a basket of goods, but how does that work when the goods are different?
How do you compare a mud hut in Africa to a house in the US?
