Purchasing power parities - a tool of international comparisons

International comparison of gross domestic product and its component expenditures is based on the utilization of purchasing power parities which are conversion rates (both currency converters and price deflators). When GDPs of countries are converted to a common currency using PPPs, they are also revalued at common set of prices. The paper presents the concept of purchasing power parity and international comparison programmes of real expenditure on GDP. Particular attention is devoted to the last programme for 1999. The article explains both the methodology and the benchmark results of the 1999 round of Eurostat-OECD Purchasing Parity Programme.