Porto & Lisbon are Best Buys

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The American economic research institute, Glassdoor Consumer Reports, has rated Porto and Lisbon as two of the most affordable places to live.

The survey is based on the “PPP  factor”, which is  an economic module formula that establishes a comparison of average wages Purchase Power Parity in 37 top cities in the world, considering the  exchange and  inflation rate indicators of each country.narrow_streets_in__3192837b

Porto features as the second most affordable place to live, followed by Lisbon in sixth place, in the  study that relates prices in national currencies of the same goods and services to purchasing power of consumers in different cities.

According to the same formula, Geneva and Zurich are the most expensive towns. The report also reveals that Portugal ranks third in 18 countries featured in the research.

This economic survey was conducted in European, American and  Asia cities of the developed world, with same opportunities of access to goods and services.80950709

While the cost of internationally-traded goods (e.g. machinery) tends to be the same in different countries (international competition tends to reduce the differentials in prices for similar products), non-internationally traded goods and services tend to be cheaper in low-income than in high-income countries.

Hence, for example, the price of a haircut in Lisbon is likely to be cheaper than in London; or a taxi ride (of the same distance) will cost more in Paris than in Athens.

This means that non-internationally traded goods and services tend to be cheaper in lower income than in higher income countries.lisbon-taxi

The determining factor is that in countries where wages tend to be lower, the services are relatively labor-intensive.

In a nutshell, in Porto or Lisbon, regardless of a lower wage, you can afford a similar quality of life to most expensive cities in the world.

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Porto e Lisboa são a segunda e a sexta cidades mais baratas do mundo, de acordo  com um relatório publicado pela  empresa americana de análise financeira Glassdoor Comsumer Reports.

O estudo estabelece um relação entre o nível de ordenados e os preços de serviços e bens de consumo em 37 cidades da Europa, América e da Asia com idênticas oportunidades de acesso a produtos e serviços.

O critério  determinante  do relatório utilizou níveis de ordenados e poder de compra de artigos ou serventias domésticas, excluindo produtos importados ou de transações internacionais .

No mesmo estudo Portugal aparece em terceira posição entre os países desenvolvidos mais económicos para viver.

Jay Fernandes
Master’s Degree G. Ph. from the University of Lisbon. Academic and teacher. Television , radio and press reporter / commentator

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