Boner: The GDP numbers were not my numbers. They were chase's numbers corrected. The hours worked are chase's numbers. They are incompatible with the GDP per capital because they are not average hours worked per capita of population, they are average hours worked per worker. So they yield neither productivity nor compensation because there is not a correction for household size.

Chase:

This is not a wrong answer on a homework assignment or test paper. This is an assertion made on a public forum accessible to thousands of people. As with any comments on social media, be careful about what you say because you can't take it back and it may come back later, perhaps years later, to bite you.

BO and Kruez:

Purchasing power parity does not refer to purchasing power of individuals or households but purchasing power of domestic currencies for the same good in different countries.

^^^but might not the reason you have such high ppp, that you buy all these cheep goods from china, and that you pay for it in part by printing new money?

Kreuz:

Differences in PPP can arise because currency exchange rates depend on demand and supply for traded goods while differences in national price levels depend on demand and supply for all goods. The U.S. and China have a large volume of trade but the trade is not a large percentage of our GDP's so we can have different PPP's. Countries that depend more on trade with each other will have more similar PPP's. The Wikipedia article has a map that shows PPP's. Bermuda and Scandinavia have higher PPP's than the U.S.

let me try to give an example of how I am thinking

if a sweater would cost 30 dollars if it was made in the us

if that sweater was made in china, it would have lower manufacturing cost, and lets say it now should cost 20 dollars,

but, since the chineese are overvaluing the dollar (buying debt)an american can buy it for lets say 15 dollars.

in this case the phurchasing power parity have doubled because the sweater was from china, and the trade deficit.



now lets take the bigmac index (which is a sort for a PPP index). I am pretty sure that the bigmac would cost more if it had not been for the trade with china, and the trade deficit with china, therefor "paying" for the bigmac with debt, and actually giving a false impression of a good PPP.


on a semirelated note
in scandinavia, the gdp compared to the us gdp is higher, than the ppp compared to the us ppp, and I think in part because of the trade surplus scandinavia is running

the point is: US works more, for longer hours, so most of the money that they are bringing home isnt going into consumables that make the quality of life better, they are going into consumables that make it to where they are a more valuable commodity to the company that they work for.

Chase:

It looks like you are saying that your judgment as to quality of life is better than the judgment of those who are buying the consumables.

We make less money for our hours worked and worse services for our taxes paid. That's the point. The only thing that makes up for our shitty compensation is that we work 10% more hours a week.

Show me the numbers, B.O.