PPP (Purchasing Power Parity)

A simple, lightweight, and dependency-free (for clients) NPM package to calculate Purchasing Power Parity (PPP) adjusted fair prices in USD.

This package allows you to calculate what a "fair" price (in USD) would be in a different country, based on the Price Level Ratio of PPP conversion factor to market exchange rate.

Installation

npm install @sachithrrra/ppp

Quick Start

Calculate a fair price for a $10 product in Sri Lanka:

import ppp from '@sachithrrra/ppp';

// Sri Lanka (Default: Smoothing 0.2, No Rounding)
console.log(ppp(10, 'LK')); 
// Output: 4.3108...

// Sri Lanka (Currency Rounding)
console.log(ppp(10, 'LK', 0.2, 'currency')); 
// Output: 4.31

// Sri Lanka (Pretty Rounding)
console.log(ppp(10, 'LK', 0.2, 'pretty')); 
// Output: 4.49 (Rounded to nice marketing numbers like .49, .99, or integers)

Why use this?

Charging the same USD price globally ignores the vast differences in purchasing power.

• $10 in the US is a cheap lunch.
• $10 in a developing nation might be a day's wage.

By adjusting your pricing, you make your product affordable to the rest of the world (parity pricing), potentially increasing your total revenue by unlocking new markets.

API Reference

ppp(originalPrice, countryCode, smoothing, rounding)

Calculates the PPP-adjusted fair price in USD.

| Parameter | Type | Default | Description | | :--- | :--- | :--- | :--- | | originalPrice | number | Required | The base price in USD (your US / Global price). | | countryCode | string | Required | The ISO country code (2-letter or 3-letter). Case-insensitive. | | smoothing | number | 0.2 | A normalization factor between 0 and 1. | | rounding | string | 'none' | Rounding method: 'none', 'currency', 'pretty'. |

Returns: number The adjusted price in USD. Returns null if the country code is invalid.

The smoothing Parameter

Raw PPP prices can sometimes be too low. The smoothing parameter helps normalize the price.

• 0.2 (Default): A balanced discount.
• 0: Raw PPP Price (Aggressive discount).
• 1: Original Price (No discount).

The rounding Parameter

Controls how the final price is formatted.

• 'none' (Default): Returns the raw calculated number (e.g. 4.310847...). Maximum precision.
• 'currency': Rounds to 2 decimal places (standard USD format).
  • 4.3108... -> 4.31
• 'pretty': Rounds to marketing-friendly numbers.
  • Prices < 10: Ends in .49 or .99 (e.g. 4.31 -> 4.49).
  • Prices 10-100: Rounds to nearest integer (e.g. 43.2 -> 43).
  • Prices > 100: Rounds to nearest 5 (e.g. 132 -> 130, 134 -> 135).

ppp.factor(countryCode)

Retrieves the Price Level Ratio (The "Fairness Factor") used for the country.

| Parameter | Type | Default | Description | | :--- | :--- | :--- | :--- | | countryCode | string | Required | The ISO country code. |

Returns: number The raw ratio used for calculation.

• ~0.29 (Sri Lanka) -> Goods are ~29% as expensive as in the US.
• ~1.0 (USA) -> Baseline.
• > 1.0 (Switzerland) -> Goods are more expensive than in the US.

How it works

The library uses the Price Level Ratio of PPP conversion factor (GDP) to market exchange rate (World Bank Indicator: PA.NUS.PPPC.RF).

Formula: Fair_Price_USD = Original_USD_Price * (Ratio + (1 - Ratio) * Smoothing)

License

MIT