Abaara topic: Balassa-Samuelson effect

 
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Balassa-Samuelson effect

Balassa-Samuelson effect is observation that price levels in wealthier countries are systematically higher than in poorer ones. This is caused by a deviance in the standard of living between any two countries. What may be regarded as middle class in the United States could very well be regarded as upper class by a citizen of a third world country.

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Page topic: Balassa-Samuelson effect