Nowadays, many economic institutions use Nominal or Real GDP to show us the commercial size of countries by a month or year. In fact, some economic instruments misguide folks and get them to think that their economy is the best in the world, compare to other economies. However, it really is not valid, as we believe.
GDP PPP (Purchasing power parity) is an economic theory that can be applied to adjust the prices of goods in a given market. In essence, instead of using current market rates for prices (such as in nominal data), PPP tries to more accurately account for differences in the cost of living between countries – especially in places where labor and goods are far cheaper.
When applied to GDP measurements, PPP can help provide a more accurate picture of actual productivity. For example, a taxi ride in Bolivia may be far cheaper than one in New York City, even though it is the same service provided over the same distance. Applying PPP to GDP figures can help correct for these types of differences. (source: https://www.visualcapitalist.com)
As it has been mentioned above, the stable and robust currency could be a trick factor for folks who are interested in economic events. Let's think that the price of bread would be 1 American dollar in the USA and 1 Turkish Lira, and presumably, the minimum wage in the USA is 1500 US dollars, and in Turkey is 2020 Turkish Lira. Now Folks in the USA may only buy 1500 pieces of bread and in Turkey 2020 piece of bread. Namely, in Turkey, people can buy more pieces of bread than people in the USA, which means that Turkish people have more purchasing power than in the USA.
That's why PPP is more accurate, yet countries having a sharp or dominating currency in the world do not would like to use PPP not to lose the view of economic power they have. Otherwise, folks might get up from the sweat dream by understanding that it was not a sweat dream at all; it was a nightmare that they've had for many years.
You're going to understand what I am talking about when you see the graph below.
Many countries change their place on the table of GDP PPP, such as Turkey, Germany, Japan, India, the USA, China, Korea, and so on.
In short, with GDP PPP, we have more certain information about the World's economy.
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