International price comparison
Producer: Statistics Finland
Main topic: Prices and Costs
Related topics: National AccountsIncome and Consumption
Official Statistics of Finland (OSF): Yes
European Statistical System (ESS): Yes
The objective of international price comparing is to produce purchasing power parities. A purchasing power parity is an exchange rate with which the prices of the commodity baskets in two countries are made identical by converting them into one, common currency. Purchasing power parities measure the value of money in a national economy on the basis of the volumes of goods and services that can be purchased with its currency. This gives a clearer picture of output per capita of a particular country’s national economy than would be provided by mere conversion of the value of its gross national product or gross national income (usually) into euros or US dollars.
Statistics Finland collects national price data for the international price comparison study in which the main objective is to produce purchasing power parities. The aim of purchasing power parities is to facilitate real comparisons of the volumes of GDP in the countries participating in the project. An index series describing the overall price level is based in each country on price surveys co-ordinated by Eurostat and the OECD. The OECD updates the results of the latest price comparisons against changes in currency exchange rates to describe the reported point of time. The data on the outlets from which prices are collected, the collected price data and detailed information on the commodities on which price data are collected may not be disclosed.
The statistics are based on Eurostat’s European Comparison Programme (ECP), whose participants include the 27 member states of the European Union, five candidate states (Croatia, Macedonia (FYR), Montenegro, Turkey and Serbia), the countries of the Western Balkans (Albania and Bosnia-Herzegovina) as well as three EFTA countries (Iceland, Norway and Switzerland). Each country’s national statistical institute is responsible for the national price data collection.
The classifications used in the purchasing parity programme are based on the European System of Accounts (ESA95).
Private consumption is classified according to the COICOP Classification of Individual Consumption According to Purpose. Private consumption is divided as follows:
- Food and non-alcoholic beverages
- Alcoholic beverages and tobacco
- Clothing and footwear
- Housing, water, electricity, gas and other fuels
- Furnishings, household equipment and routine household maintenance
- Recreation and culture
- Restaurants and hotels
- Miscellaneous goods and services
Data collection methods and data sources
Within the purchasing power parity programme Eurostat and the OECD collect annually data concerning national prices and expenditure. Thus, overall results at the level of GDP (purchasing power parities, price indices and real volume comparisons for diverse aggregates) are calculated each year. These results are published on Eurostat’s website. Likewise, the OECD updates monthly the price indices of private consumption against changes in inflation and currency exchange rates.
- International price comparison: Collection of price data for health care and furniture
- International price comparison: Collection of price data for machinery and equipment (investment commodities)
- International price comparison: Data collection for domestic appliances and other household commodities prices
- International price comparison: Data collection for motor vehicles, restaurants and hotels prices
- International price comparison: Data collection of clothing and footwear prices
- International price comparison: Data collection of food, beverages and tobacco prices
- International price comparison: Data collection of service prices
The OECD's index table concerning the overall level of private consumption prices is updated monthly.
Time of completion or release
Eurostat calculates the purchasing power parities for each calendar year and publishes the final annual results no later than 36 months from the end of the statistical reference year. The published data are based on data made available to Eurostat no later that three months before the publication date. The Regulations do not affect the Commission’s (Eurostat) right to publish premilinary data already before 36 months have passed since the end of the reference year.
The OECD publishes indices on private consumption prices in its Main Economic Indicators series in three months from the statistical reference point of time.
Finland joined the purchasing power parity programme in 1980 and also participated in the 1985 and 1990 surveys. Annual results in which Finland is included are available starting from 1992. However, temporal comparing should be avoided because of the multilaterality.
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Last updated 30.10.2015