Russia overtakes Japan to become the fourth largest economy in the world in PPP terms

PPP GDP is generally considered a better measure of living standards and economic well-being because it accounts for the fact that prices for the same goods and services can vary significantly across countries. A dollar might buy you a lot more in one country than it does in another. For example, if a haircut costs $10 in the US and the equivalent haircut costs 500 rupees in India, nominal GDP might suggest that the US economy is much larger. However, if the PPP exchange rate shows that 500 rupees has the same purchasing power as $5, then the Indian economy is relatively larger in PPP terms.