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I find it quite hard to get a clear picture of what the income numbers in Gapminder's Dollar Street tell. How to compare \$27 in Burundi with \$10,098 in China? What would it mean that the family in Burundi is 500 times "poorer" than the family in China?

There are two aspects that are unclear to me:

  1. Wouldn't it be a better measure (than income is) to quantify how much of the money one needs to lead a "normal healthy" life one has at ones disposal (in percent)? How is this measure called?

  2. What about self-suppliers (what many families in poorer countries are)? They own and need less money (income) than others do, but how is the value of their self-supplying work measured?

In the context of self-supply: Wouldn't "belongings" be a better measure than "income"?

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On Gapminder's website they write

If you have a question, maybe it's already answered in our Q&A.
Q&A

The underlined text links to a Google document, which answers several questions. Under one of these answers

The households’ door numbers represent the consumption values (US dollars) that each adult in the household has per month. This figure comes from a combination of the household’s self-reported consumption and income levels. We then checked official cost of living data in each country to adjust the values for purchasing power parity (PPP) and converted the value into US dollars.

there is a link to a further Google document titled Detailed income calculations for Dollar Street. This second one seems to answer your question, but it is several pages long, so I will not copy paste its full body of text here.

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  • $\begingroup$ Thanks a lot! Can you help me to understand how exactly PPP is applied (is it a number per country? where do I find these numbers?) and how is "the value" converted into US dollar? (Maybe the "Detailed income calculations" document answers these questions, but I would not have understood it.) $\endgroup$ – Hans-Peter Stricker May 15 at 11:56
  • $\begingroup$ I am afraid I haven't the time to give a comprehensive explanation of PPP, but this is a well-known concept, I am sure there are some questions on this very site that will be useful to you. $\endgroup$ – Giskard May 15 at 18:33
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    $\begingroup$ These are valid questions, but also very old questions, so here or Wikipedia can very easily explain the PPP or most other concepts you’ll likely find in the document cited by @Giskard. As you correctly anticipate this calculations are not trivial, and usually far from perfect. comparisons across countries can be heroic at times. But comparisons are important and people dedicate their carries to making them better. However you can easily learn the gist of what they do by reading the files that document how the data was collected and adjusted to allow for comparisons across countries. $\endgroup$ – Regio May 17 at 5:49

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