Join the new world

So you've worked today and made 20 grd. Is that enough? Well, even if it was double you'd still like to make more. No salary can totally satisfy us. But how much is 20 grd really? How good is it? It's as good as the products we can buy with it and the higher it is than other people's salary, the better it is. Now we are getting to the real value of our salary.
In this article I'm going to discuss two ways of estimating your real income.

The first one is the Gold equivalent. All currencies are being exchanged for gold and vice versa. Currencies can also be exchanged for one another, but we better discard this market. Gold is the universal currency and you all know its importance. So when we want to compare prices or wages around the world, we convert them to gold and make the comparisons. This approach is pretty straightforward. It's a good method to evaluate our real income, especially if we use the MM to buy gold and use it for whatever. But what about those who don't trade their local currency, but instead
they use it to purchase goods from the local marketplace?

For these people the best evaluation of their income is in terms of what they can buy with it. This is the Purchasing Power Parity approach (from now on PPP). I'm going to show you how to calculate Income-PPP across countries.
Lets say we have two countries, Greece and Spain. People in those two countries buy a basket of goods regularly. A representative basket of goods (RBG) can be: 2q1 food, 5q2 food, 2q4 food, 2q1 weapons, 1q3 weapon, 1q1 ticket and a tenth of a house (yeah you buy bricks one by one daily😛)

Cost of RBG in Spain is RBGs and cost in Greece is RBGg. By dividing RBGs over RBGg you get the PPP exchange rate (XR) of peseta to drachma. The "real" XR. You proceed to do the same with all other currencies and get the PPP XR of all currencies to GRD. (We will use GRD as the benchmark currency. Forget about gold altogether here).

The hard part is done. Now you get income data for all countries in local currency, you divide by the XR above and in this way you convert all income to PPP. That's it! You can now compare income (salaries) around the world!


Now let's get to business! I've estimated PPP salaries for the 25 strongest/biggest countries.
For the RBG I used Q2 food. Only. Don't laugh, it can be quite accurate.
For Q2 food prices I took samples over the last couple days.
For salaries, I used Experts and Masters only! So you can see it as "expert-master PPP salary". Too much work to do for everyone... Again I took sample salaries from the job markets.
I wish I could utilize scripts, but I cannot. So I can do that much... For more info on my methodology feel free to comment or PM me.

So without further ado...



The column "Income in G Index" shows the (net of tax) Income for our representative Expert-Master, converted in Gold. It is an index whick takes the value of 1 for Greece.
The column "Income PPP Index" shows the (net of tax) PPP Income (in GRD). The index takes the value of 100 for Greece.

- Greece is low on both G and PPP Income... Same for the US.
- Canada, with their expensive dollar, ranks 2nd in G income, but drops 13 (!) places in PPP Income. Their currency is overpriced b/c they export too much.
- Spain is doing OK, while Romania is in very good shape. Romanians have a unique tax-system, which could be an article by itself.
- For some reason, Indonesia ranks 1st in PPP income and Lithuania looks great. Don't ask me why.
- Italy gains a lot in PPP terms, while Argentina drops a ton.
- Look at Turkey... Guys, either we are doing something wrong in eGreece or my numbers are wrong. Hope it's the latter...
- I also put Vardarska out there just to laugh at them. Poor Vardarskans😛

N.B.: Treat those numbers with caution. It would have been much better if I had accurate salary data from Coordinator to Guru*, as well as a couple more products in that basket of goods.

Thank you for reading,

~Dodona