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The $1500 figure is indeed the correct nominal figure, but it's just a number, it's meaningless without context (prices). If you take that into account you get a sense of purchasing power that's comparable between countries, the PPP figure. That's $4500 in Ghana and it's likely what he's quoting.

That having been said, the nominal figure is typically more useful when it comes to manufactured imported goods like computers, or energy prices, as they aren't actually cheaper in developing countries (and sadly, often the opposite).

So both figures are going to be useful in getting a sense of affordability here.




I actually think otherwise. PPP can be very high in countries with high inflation and masked real costs (ie: The products are subsidized but not available, so people have to pay the real/full price).

The real one is, well, real.


I don't really see the point. PPP is typically measured by looking at actual prices for a basket of goods (e.g. prices in stores for various grains, flour, rice, legumes, cooking oil etc), and then using that to extrapolate for aggregate prices for types of goods (e.g. food), and then correcting income figures for price differences.

I agree that high inflation and temporarily-subsidised goods make measurement difficult, because it creates a highly volatile price, but that's true whether you want to measure nominal prices or real prices just the same. Stating a nominal price for food in Venezuela in March 2018 is difficult because sometimes it's available, sometimes not, sometimes it's subsidised via government channels, sometimes you need to buy it through market channels, and prices fluctuate due to inflation and currency swings. Nominal price measures have the same difficulties.

That having been said, there are only a few countries suffering these circumstances. Ghana has a relatively stable inflation around 10% to 20%, which sounds high (and it is), but is not much higher than inflation in the 60s-80s in the US or Europe (reaching 15%+) and is quite predictable and workable (unlike inflation of literally billions of percent in Zimbabwe in 2009).




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