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View Full Version : Gross domestic product based on PPP per capita GDP in European countries (2016/ 2017)



RN97
02-13-2017, 09:11 PM
PPP means purchasing power parity. PPP is the best way to use GDP per capita to measure wealth in a country because it is based upon what you can get(goods/ services) for the money you have. http://www.investopedia.com/updates/purchasing-power-parity-ppp/

Purchasing Power Parity (PPP) is an economic theory that compares different countries' currencies through a market "basket of goods" approach. According to this concept, two currencies are in equilibrium or at par when a market basket of goods (taking into account the exchange rate) is priced the same in both countries.

Obviously some of these numbers are estimates.
http://i.imgur.com/LpZwiTV.png

Source:
https://www.imf.org/external/pubs/ft/weo/2016/02/weodata/weorept.aspx?sy=2016&ey=2017&scsm=1&ssd=1&sort=country&ds=%2C&br=1&pr1.x=34&pr1.y=17&c=914%2C946%2C137%2C962%2C122%2C913%2C124%2C921%2C 943%2C963%2C918%2C138%2C142%2C964%2C182%2C960%2C42 3%2C968%2C935%2C922%2C128%2C942%2C939%2C936%2C961% 2C172%2C132%2C184%2C134%2C174%2C144%2C146%2C944%2C 176%2C178%2C136%2C926%2C112%2C967%2C941&s=PPPPC&grp=0&a=#download

alpha
02-13-2017, 09:17 PM
only poor countries use ppp to make themselves look better.

RN97
02-13-2017, 09:18 PM
only poor countries use ppp to make themselves look better.

How does PPP make poor countries look better?

HellLander87
02-13-2017, 09:38 PM
GDP for Albania is FAKE.Some zeros are MISSING.

Shah-Jehan
02-13-2017, 09:43 PM
Interesting, some of the poorer countries have comparable rates as Sri Lanka.

http://www.imf.org/external/pubs/ft/weo/2015/01/weodata/weorept.aspx?pr.x=48&pr.y=18&sy=2014&ey=2019&scsm=1&ssd=1&sort=country&ds=.&br=1&c=524&s=NGDPD%2CNGDPDPC%2CPPPGDP%2CPPPPC&grp=0&a=

RN97
02-13-2017, 10:17 PM
I would also like to add that calculating GDP per capita based upon PPP is indeed better than strictly based upon a currency.
The reason being is that it calculates the goods one can get within a country and this will drive the economies of poorer countries. The GDP per capita is higher in Norway normally than the GDP per capita based upon PPP. That means that imports are cheap and exports are mostly undesirable (Norway is an exception actually but just forget that).
Basically poorer countries will find it easy to have high net exports driving/ helping the economy. It is indeed mostly good that for countries like Romania foreign goods are very expensive and local ones are much cheaper as well as they will be very cheap for other countries. In the end it will increase the total GDP.