Originally Posted by Gorman
Even if we didn't invent the name "Purchasing power parity" or even the concept, it's principals would still be in effect.
Like you said once before "if you are dying of thirst, which is more valuable, a gallon of water of a ton of gold?". This is essentially the PPP in effect. This is not some artificial construct that humans have unanimously decided to agree with - things really do have value dependant on context.
The ambiguity is introduced when you realize that the man might actually take the gold, and there is no way to quantify this probability. Indeed, there are so many incalculable possibilities (see: a random walk) that economics as applied to the real world is extremely imprecise, much more so than physics. Economics is a science, but even though conceptually it may be concrete, in practice it is not.