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The Global Economic Environment

The Global Economic Environment. Gross National Product TURKEY. PPP (Purchasing Power Parity).

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The Global Economic Environment

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  1. The Global Economic Environment

  2. Gross National Product TURKEY

  3. PPP (Purchasing Power Parity) • Purchasing power parity (PPP) is an economic theory and a technique used to determine the relative value of currencies, estimating the amount of adjustment needed on the exchange rate between countries in order for the exchange to be equivalent to (or on par with) each currency's purchasing power. • asks how much money would be needed to purchase the same goods and services in two countries, and uses that to calculate an implicit foreign exchange rate. Using that PPP rate, an amount of money thus has the same purchasing power in different countries.

  4. GDP PER CAPITA

  5. GDP Adjusted for PPP GDP per capita based on purchasing power parity (PPP). PPP GDP is gross domestic product converted to international dollars using purchasing power parity rates. The Gross Domestic Product per capita in Turkey was last reported at 16885.30 US dollars in 2011, when adjusted by purchasing power parity (PPP), according to a report published by the World Bank

  6. Gini coefficient • The Gini coefficient is a measure of statistical dispersion most prominently used as a measure of inequality of income distribution or inequality of wealth distribution. It is defined as a ratio with values between 0 and 1: A low Gini coefficient indicates more equal income or wealth distribution, while a high Gini coefficient indicates more unequal distribution. 0 corresponds to perfect equality (everyone having exactly the same income) and 1 corresponds to perfect inequality (where one person has all the income, while everyone else has zero income). • The Gini coefficient requires that no one have a negative net income or wealth. Worldwide, Gini coefficients range from approximately 0.232 in Denmark to 0.707 in Namibia although not every country has been assessed. • The Gini index is the Gini coefficient expressed as a percentage. Thus Denmark's Gini index is 23.2%. Turkey’s Gini index is 39%.

  7. Human Development Index • The Human Development Index (HDI) is an index combining normalized measures of life expectancy, literacy, educational attainment, and GDP per capita for countries worldwide. It is claimed as a standard means of measuring human development—a concept that, according to the United Nations Development Program (UNDP), refers to the process of widening the options of persons, giving them greater opportunities for education, health care, income, employment, etc. • The basic use of HDI is to rank countries by level of "human development", which usually also implies to determine whether a country is a developed, developing, or underdeveloped country.

  8. Human Development Index 2008 update

  9. Current Account Deficit

  10. Index of Economic Freedom • In practice, the index measures: • Size of Government: Expenditures, Taxes, and Enterprises • Legal Structure and Security of Property Rights • Freedom to Trade Internationally • Regulation of Credit, Labor, and Business Return

  11. Low-Income Countries • GNP per capita of $785 or less • Characteristics • Limited industrialization • High percentage of population involved in farming • High birth rates • Low literacy rates • Heavy reliance on foreign aid • Political instability and unrest • Of these, only China and India are BEMs Return

  12. Lower-Middle-Income Countries • GNP per capita between $786 and $3,125 • Sometimes called less-developed countries (LDCs) • Characteristics • Early stages of industrialization • Cheap labor markets • Factories supply items such as clothing, tires, building materials, and packaged foods • 3 BEMs: Poland,Indonesia

  13. Upper-Middle-Income Countries • GNP per capita between $3,126 to $9,655 • Characteristics • Rapidly industrializing • Rising wages • High rates of literacy and advanced education • Lower wage costs than advanced countries • Sometimes called newly industrializing economies (NIEs) • 3 BEMs: Argentina, Brazil, Mexico, South Africa, Turkey Return

  14. High-Income Countries • GNP per capita above $9,656 • Sometimes referred to as post-industrial countries • Characteristics • Importance of service sector, information processing and exchange, and intellectual technology • Knowledge as key strategic resource • Orientation toward the future Return

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