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International Statistics Activity
The international comparison program (ICP) is an international project that was launched to make a substantial comparison of the gross domestic products (GDP) of countries in the world by calculating the purchasing power parities* of the currencies of these countries.
Currency conversion based on an exchange rate is one of the general methods of international comparison, but the exchange rate poses the problem that (1) the domestic prices of non-trade commodities (e.g., education, medical, construction, government services, etc.) are not reflected in the exchange rate, and that (2) the exchange rate easily comes under the influence of speculation activities and inter-nation capital transfer. In international comparison, therefore, currency conversion based on purchasing power parity is a proper method because purchasing power parity is hardly affected by capital transfer and is stable. This led to the ICP project.
*Purchasing power parity (abbreviated as PPP) is a sort of conversion ratio between the currency of one country and that of another country, and is so calculated as to equalize the purchasing power of one currency (amount of goods and services that can be purchased with the currency) with that of another currency. Let's consider purchasing power parity on one commodity. When a can of beer is priced at 200 yen in Japan and at 70 cents in the United States, the purchasing power parity of yen and dollar on beer is calculated at 1 dollar=285.7 yen (200 yen/0.7 dollar).
The ICP project was started by the United Nations Statistics Division in 1969, based on advice from the United Nations Statistical Commission. Japan has been on the project since the start of the third period project (for 1975), and, with the cooperation of ministries and agencies involved in the project, has been providing price data and expense weight data on survey subject articles. The project was suspended after the end of the sixth period project (for 1993), but the project implementation structure, etc., was rebuilt in following years. At present, the worldwide project for 2005 has started under the leadership of the World Bank, and Japan is taking part in the program.
As part of the ICP project, a purchasing power parity program with the participation of OECD member countries and EC member countries has been implemented since 1980 under the leadership of OECD and Eurostat (Statistical Office of the European Communities). Japan is also participating in the program, and the 2008 round (2006 to 2009) survey is now in progress.
The following is the major survey result.
[World project]
[OECD/Eurostat purchasing power parity program]
Text (PDF:490KB) / Table/Appendix
For further information on the world project and the OECD/Eurostat purchasing power parity program now in progress, see the World Bank home page and the OECD home page.
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