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More BRICS - more countries join that political and economic bloc

barbos said:
Nominal GDP is garbage.
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Nominal GDP means not adjusted for inflation (when comparing same country over time).
What you probably mean is market-price GDP when comparing different countries at the same point in time (and unlike PPP, using the same yard strick to measure them).
And you have provided zero evidence for this claim.
No, not like that.
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How then?
 
Derec said:
laughing dog said:
Purchasing power parity (PPP) is the most common method for comparing GDP of countries since it adjusts for different price levels.
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As such GDP (PPP) fails to measure the relative sizes of economies as it measures economies using different yardsticks. Market-price GDP uses the same yardstick.
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Market price GDP uses different yardsticks- exchange rates.
 
laughing dog said:
Market price GDP uses different yardsticks- exchange rates.
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Exchange rates are there to convert local currency to the same yardstick - the US dollar.
PPP has an "international dollar" that is worth a different amount of real dollars based on the country. Hence, different yardsticks.
PPP is good for comparing things inside a country, but for comparison between countries you need to measure with the same yardstick.
 
Derec said:
laughing dog said:
Market price GDP uses different yardsticks- exchange rates.
Click to expand...
Exchange rates are there to convert local currency to the same yardstick - the US dollar.
PPP has an "international dollar" that is worth a different amount of real dollars based on the country. Hence, different yardsticks.
PPP is good for comparing things inside a country, but for comparison between countries you need to measure with the same yardstick.
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Exchange rates do not necessarily adjust for differences in price levels. Which means differences in market price GDP reflects differences in output and prices.

And exchange rates reflect a different amount if nominal dollars based on the country. So exchange rates are different yardsticks .
 
Derec said:
Per-capita GDP (PPP) gives you a measure of well-being inside a country, yes. Per-capita GDP (MP) gives you a measure of well-being when trying to buy something on the international market. Say a Russian and a German want to buy some groceries, of a meal at a restaurant or a hair-cut in their country. PPP is appropriate here. But say both want to go to a vacation in Greece? Market price matters here, not PPP.
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But most purchases are internal. Market price only becomes relevant for imports and exports.

Derec said:
Another difficulty of PPP is how do you measure it? Market price of a currency is relatively easy even if you have to use black market exchange rate. PPP is much more complicated and different organizations may configure their basket of goods and services differently leading to different PPP values. That's why Barbos may be technically correct (even if he refuses to provide a source for his claim) that using certain set of "yard sticks" Russia has higher GDP (PPP) than Germany (still much lower on a per-capita basis of course) but still trails Germany using the yard sticks used by the IMF.
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I do agree that it's hard to measure but that doesn't make it wrong.

I will take his side on this--except I don't trust the Russian numbers. I find it unreasonable that you can't see a blip from the war. (And there are things like Russia selling discounted oil to India in Rupees. Oops--there's not a lot you can buy with Rupees. They have a lot of money in the bank that they can't spend.) There's also all those western businesses they seized, why didn't that increase their GDP?
 
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