> so local labor rates which ppp approximates This is a short run comparison. See the article I mentioned earlier. There is little evidence that PPP comparison

> so local labor rates which ppp approximates This is a short run comparison. See the article I mentioned earlier. There is little evidence that PPP comparisons, over a short period of time, are meaningful. PPP is calculated by a basket of goods. There are valid reasons for why the price of, e.g., flour costs X in one country and Y in another country that have little to do with the purchasing power of their respective currencies. This is why there are a disproportionate number of island nations that have high price level ratios - it is expensive to import 'stuff', and this inadvertently increases how much this 'stuff' and what it is eventually processed into costs.