Reply to thread

Message: <blockquote data-quote="Jfdlsjfd" data-source="post: 9516995" data-attributes="member: 42856"><p>I understand you're speaking of PPP (purchasing power parity). But even this measure is skewed by the fact that the basket of goods upon which it is calculated doesn't reflect what the local buys. It's the same with inflation: it's an average, and you can be affected more by inflation if you do not buy exactly the same type of goods than is used (for example, if gas and vegetable increase a lot, and smartphone goes down, but you don't buy smartphones and only buy gas and vegetable, your expanses will increase more than if you had bought a smartphone on top). With PPP, the measurement does work like you say, but Afghan, when converted to US-like wage, do not buy the same thing as a US household, they simply won't afford new smartphone, will have trouble buying gasoline, goods that are imported... because it's extremely expensive, but they will buy proportionally more locally-produced goods and services, which are even cheaper than the PPP modifier do reflect.</p></blockquote><p></p>