What is your opinion on which is better to use?
I assume the best way to do it would be to take everything being traded and use market exchange rates/nominal, with all goods and services made in China to be broken down into each part, supply, etc. and those produced domestically converted into the PPP equivalent of that resources price index.
If so, I assume China's actual economic size relative to the US is approximate parity as of 2020. Problem is for many high technology items nominal GDP is a better use, so China's PPP metric doesn't really align with China's ability to produce X number of planes or other high-tech stuff IMO.
It all depends on what you are trying to measure. For example
Is it living standards or military/industrial output? Then PPP is better.
Is it economic influence abroad? Then the exchange rate figures make more sense.
As for hi-tech items, I'd say PPP is better overall now.
That wasn't the case 10 years ago.
And PPP will definitely be a better measure in 5 years time.
You can see R&D is mostly wages in developed countries like Germany etc
And China is spending more on technology R&D than the USA, as per the National Science Foundation reports.
So China will likely have its own domestic tech companies in every industry in the future.
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I've previously mentioned that for a whole host of industries, China produces or consumes more than the rest of the world combined.
So in these areas, domestic output and pricing is the only logical benchmark.
Not a comparison using exchange rates with the rest of the world.
