International price comparison: documentation of statistics

The international price comparison covers all sections of the national economy.

Price level indices and purchasing power parities are calculated for each participating country, for the EU as a whole and for a group of euro area countries.

The European System of Accounts (ESA 2010) defines the population.

In purchasing power parity calculations, the consumption aggregates that make up gross domestic product (GDP) are divided into 235 basic headings. Basic heading is the lowest level of aggregation for which prices are collected and for which countries produce consumption weights.

Eurostat publishes purchasing power parities and price indices for 64 analytical categories. These include GDP, actual individual consumption, private consumption, collective consumption and investment.

Finland participates in the European Comparison Programme (ECP) coordinated by Eurostat. The country groups included are:

• 27 EU Member States
• nine candidate countries (Albania, Bosnia and Herzegovina, Georgia, Moldova,  Montenegro, North Macedonia, Serbia, Turkey  as well as Ukraine)
• three EFTA countries (Iceland, Norway and Switzerland).

In each country, the national statistical office is responsible for the national data collection. 

Eurostat has a mandate to make data on Europe available to the global ICP (International Comparison Programme). The global comparison included 176 countries in the 2021 round.

The results are available for EU member states since 1995 in the Eurostat database. The group of countries involved has expanded over time. Eurostat publishes preliminary data for different country groups during the year following the reference year. For more information on the revision of figures, see Timeliness (SIMS 14.1).

This is a time-bound exploratory study, and therefore, comparisons to results from previous years are not recommended.

The price level is described by an index point figure relative to the EU average (e.g. EU27_2020=100).

Purchasing power parity is an exchange rate at which the price of a commodity basket of two countries is exactly the same when converted into a common currency.

The reference date is the calendar year.

The classifications used in the Purchasing Parity Programme are based on the European System of Accounts (ESA2010), which is an internationally compatible accounting framework. It systematically and in detail describes a total economy (i.e. a country, region or group of countries), its components and its relations with other national economies. 

Private consumption is classified according to the COICOP 2018 Classification of Individual Consumption According to Purpose. Private consumption is divided as follows:

01 Food and non-alcoholic beverages 

02 Alcoholic beverages and tobacco 

03 Clothing and footwear 

04 Housing, water, electricity, gas and other fuels 

05 Furnishings, household equipment and routine household maintenance 

06 Health 

07 Transport 

08 Information and communication

09 Recreation, sport and culture 

10 Education services

11 Restaurants and accommodation services

12 Insurance and financial services

13 Personal care, social protection andd miscellaneous goods

The function classification of non-profit institutions serving households is COPNI (Classification of Non-Profit Institutions Serving Households), which is used to classify the consumption expenditure, gross capital formation, and capital and current transfers of the non-profit institutions concerned.

The Classification of the Functions of Government (COFOG) is intended for the description of public sector transactions.

The CPA (European Classification of Products by Activity) is intended to be used for statistics related to consumption, foreign trade and transport in the area of the European Union.

The compilation of statistics is guided by the Statistics Act. The Statistics Act contains provisions on collection of data, processing of data and the obligation to provide data. Besides the Statistics Act, the General Data Protection Regulation, the Data Protection Act and the Act on the Openness of Government Activities are applied to processing of data when producing statistics.

Statistics Finland compiles statistics in line with the EU’s regulations applicable to statistics, which steer the statistical agencies of all EU Member States.

Further information: Statistical legislation

• Regulation (EC) No 1445/2007 of the European Parliament and of the Council of 11 December 2007 establishing common rules for the provision of basic information on Purchasing Power Parities and for their calculation and dissemination.
• Commission Regulation (EU) 2015/1163 of 15 July 2015 implementing Regulation (EC) No 1445/2007 of the European Parliament and of the Council as regards the list of basic headings used for Purchasing Power Parities.
• Commission Regulation (EU) No 193/2011 of 28 February 2011 implementing Regulation (EC) No 1445/2007 of the European Parliament and of the Council concerning the system of quality control used for Purchasing Power Parities.

In addition, the EU regulations concerning the Structural and Cohesion Funds are legally associated with the Purchasing Power Parities Programme. The Regulation adjusting the weightings applicable to the remuneration of officials of the European Communities also requires the calculation of the PPPs.

Statistics Finland compiles the basic data concerning Finland and submits them annually to Eurostat for the purpose of carrying out purchasing power parity calculations.

The collection of price data may impose some response burden on companies. Statistics Finland endeavors to reduce this by use of transaction data and other centralized data sources, where feasible, and by gathering prices from companies' websites.

Additional data necessary for calculations are primarily sourced from existing Statistics Finland repositories.

1. Final GDP expenditure weights: national accounts statistics
2. Actual and imputed rents: statistics on housing prices
3. Compensation of employees: wage statistics
4. Temporal adjustment factors: consumer price index statistics
5. Prices of consumer goods and services and related indicators of representativeness: special price survey
6. Prices of equipment goods: special price survey: International price comparison: Collection of price data for machinery and equipment (investment commodities)
7. Prices for construction projects: data collection on prices of construction projects by an external expert
8. Spatial adjustment factors: Consumer Price Index statistics
9. Research on the prices of public hospital services: National Institute for Health and Welfare (THL)

Prices for consumer goods and services. Following six price surveys are implemented every third year i.e. two price surveys per year:

• International price comparison: Data collection for motor vehicles, restaurants and hotels prices
• International Price Comparison: Data collection for domestic appliances and other household commodities prices
• International Price Comparison: Data collection of services prices
• International price comparison: Data collection of food, beverages and tobacco prices
• International price comparison: Collection of price data for health care and furniture
• International price comparison: Data collection of clothing and footwear prices

1. GDP expenditure weights: annually
2. Actual and imputed rentals: annually
3. Compensation of employees: annually
4. Temporal adjustment factors: annually
5. Prices of consumer goods and services and related representativity indicators: two price surveys a year
6. Prices of equipment goods: every two years
7. Prices of construction projects: annually
8. Spatial adjustment factors: every six years according to the PPP Regulation; in practice, annually.
9. Survey on the prices of public hospital services: annually

Price level comparisons look at the prices of the same type of goods in different countries. Due to different consumption patterns in different countries, the goods and services to be included in the comparison are selected in cooperation between the national statistical offices, Eurostat and the OECD. In terms of private consumption, the weight structure of the commodity basket is formed in accordance with households' consumption.

In each country, local statistical offices are responsible for their own national data collection and can choose the most appropriate methods within the framework of the PPP manual and the research-specific price collection guidelines.

Statistics Finland collects data on Finland for the survey. Shop sample varies according to each research entity. There is a representative sample of shops of different sizes and types. Typically, price collection is limited to the capital region and, if necessary, spatial adjustment factors are provided to Eurostat to convert prices into national average prices.

Statistics Finland's statistical interviewers collect prices mainly from companies' websites. Email and phone contacts and occasional business visits complement the price collection. Transaction data has been introduced and efforts are being made to increase its use. The data collection is preceded by training in accordance with Eurostat's price collection guidelines.

The price collection of investment commodities follows the same method, but also targets importers and wholesalers. The construction price survey requires special expertise in the field and the data is compiled by an external expert for Statistics Finland.

1. Intra-country validation prior to submission of data to Eurostat.

2. Inter-country validation when data from all countries participating in the comparison are uploaded to the validation tool.

Before submitting data to the Commission (Eurostat), each Member State checks the validity of its data on the basis of the following data and price collection application indicators:

• The maximum and minimum prices
• The average price and coefficient of variation
• The number of priced items per basic heading
• The number of priced representative items per basic heading and
• The number of prices observed per item.

Once the data has been uploaded to the Eurostat validation tool, the validation process will continue by both Statistics Finland and Eurostat. Validation includes logical checks and draws attention to divergent price observations. The validation tool makes it possible to compare data with data from reference countries and provides a set of statistical indicators to support validation. Eurostat is responsible for the consistency of validation.

The prices collected are converted into the annual average prices by means of temporal adjustment factors. If necessary, the prices in the capital region are converted into national average prices by means of spatial adjustment factors.

Eurostat calculates the results of the comparison, first at product level and then at basic heading level. Finally, weight data from national accounts are added to the calculation, thus providing weighted results for different aggregation levels. Consumption weights are not used in the calculation of the basic heading level, but they are included in the calculation of the upper aggregation levels.

The calculation of purchasing power parities at the basic heading level is based on a Fisher-type index, for which both Laspeyres and Paasche indices must first be calculated. The Èltetö-Köves-Szulc (EKS) method is used. Basic heading parities are combined and consumption weights can be used to calculate weighted parities for all aggregation levels up to the level of gross domestic product (GDP).

Further information on the methodology can be found in english in the Eurostat-OECD Methodological Manual on Purchasing Power Parities, which is available in electronic form on Eurostat's website.

Purchasing power parity-based indicators are widely used in both EU institutions and other international organisations to support decision-making. The EU Structural Funds use purchasing power-adjusted GDP data to decide on the distribution of financial assistance to member states.

The accuracy of Purchasing Power Parity (PPP) and related indicators, such as price level indices, improves with aggregation. Data at the GDP level are considered more reliable or accurate compared to sub-aggregate levels. Basic data are sourced from various origins, including price collections for specific PPP calculations and national accounts. Therefore, it is not feasible to determine a singular numerical margin of error.

Comparable and representative items mean those which are, or are considered to be, in terms of relative total expenditure within a basic heading, among the most important items purchased in national markets. Eurostat’s PPP programme aims to ensure both comparability and representativeness at each stage of the price survey process.

Price collections for private consumption may show measurement errors if the exact definitions given in the comparison regarding, for example, package sizes and quality variables are not followed when selecting the products to be priced. Validation aims to eliminate the impact of such errors by comparing data from different countries and assessing the credibility of price relations. Similar errors may also occur in other areas of the comparison, e.g. when comparing public sector salaries. In terms of salaries, the problem is related to the different datasources used by countries.

The lack of individual price information is rarely a significant problem, as the significance at the level of published aggregates is usually minor. If a single country is unable to price any product under the basic heading, a reference parity is used in the calculation. This means a parity of either a similar basic heading or a parity of a higher hierarchy level aggregate is used.

Quality management requires comprehensive guidance of activities. The European Statistics Code of Practice forms the basis for the common quality system of the European Statistical System.

The Code of Practice is based on 16 principles that concern statistical authorities' independence, accountability and the quality of the processes and data to be published.

The principles are in line with the Fundamental Principles of Official Statistics approved by the United Nations Statistics Commission and are supplementary to them. The quality criteria of Official Statistics of Finland are compatible with the European Statistics Code of Practice.

Further information: European Statistics Code of Practice | Statistics Finland and Recommendations of the Advisory Board of Official Statistics of Finland | Statistics Finland

Countries produce an annual written inventory describing e.g. the data sources and methods used. Eurostat uses inventories to assess countries' work.

At least every six years, Eurostat carries out an evaluation of each European country participating in the PPP programme to ensure that the tasks under the PPP Regulation have been carried out with high quality. The evaluation reports for the countries are available on Eurostat's website.

The latest Compliance Monitoring visit for the Purchasing Power Parity Programme was made to Statistics Finland in 2024.

Revisions – i.e. improvements in the accuracy of statistical data already published – are a normal feature of statistical production and result in improved quality of statistics. The principle is that statistical data are based on the best available data and information concerning the statistical phenomenon. On the other hand, the revisions are communicated as transparently as possible in advance. Advance communication ensures that the users can prepare for the data revisions.

The reason why data in statistical releases become revised is often caused by the data becoming supplemented. Then the new, revised statistical figure is based on a wider information basis and describes the phenomenon more accurately than before.

Revisions of statistical data may also be caused by the calculation method used, such as annual benchmarking or updating of weight structures. Changes of base years and used classifications may also cause revisions to data.

To ensure purchasing power parity calculations closely match the revised figures in national accounts, these calculations are reviewed twice a year, in June and December.

The final published purchasing power parity figures (t-36) remain unaltered. However, any identified errors will be corrected and published if detected within three months of publication.

Exceptional general revisions may occur if substantial changes are made to the fundamental concepts of ESA 2010, which governs national accounts. The most recent comprehensive revision of the time series was conducted in 2016 with the introduction of the ESA 2010 Handbook.

In terms of purchasing power parities, Eurostat publishes:

• The first preliminary PPP results for all participating countries will be published 6 months after the end of the reference year. All data available for the reference year at that time and data based on the previous year (t+6) in other respects are included.
• Preliminary PPP results are published within 12 months of the reference year in December (t+12).
• The interim PPP results are published within 24 months of the reference year in December (t+24).
• Final OVP results are published within 36 months of the reference year in December (t+36).

In addition, Eurostat publishes a flash estimate t+3 for the EU Member States in March each year, including all available data for the reference year and an estimate based on data from the previous year.

In June each year, Statistics Finland publishes the most recent price indexes for the product groups of private consumption. These figures are not revised, but represent the original release date (t+6).

No delays normally.

This is a multilateral comparison in which classifications and guidelines are common to all participating countries.

Commodity baskets and classifications change over time and there may also be changes in the group of participating countries. Therefore, comparison of results to previous years is not recommended. The statistics measure the price level at a given time, not the change in the price level over time.

Recommended uses:

• To make spatial volume comparisons of GDP as snapshots.
• To group countries by their volume index.
• To group countries by their comparative price levels.

Not recommended uses:

• As precise measures to establish strict rankings of countries by their volume index.
• As a means of constructing national growth rates.
• As measures to generate output and productivity comparisons by industry.
• As measures to undertake price level comparisons at low levels of aggregation.
• As indicators of the undervaluation or overvaluation of currencies.

The Consumer price index and the International price comparison both use the Classification of individual consumption according to the purpose (COICOP2018).

The International price comparison describes the price level of a single country in relation to other countries. The Consumer price index describes the price development of goods and services purchased by households in Finland. The Consumer price index is used as a general measure of inflation.

The weights employed in purchasing power parity (PPP) calculations must align with the aggregates utilized in national accounting systems.

One of the main distinctions between PPP and national accounts lies in the treatment of consumption expenditure. PPP figures are revised semi-annually in June and December. Conversely, national accounts continuously update consumption expenditure to enhance accuracy.

Both methodologies utilize the COICOP2018 classification (Classification of individual consumption according to the purpose) for private consumption purposes.

The shares of expenditure components in current-price GDP, i.e. the final expenditure weights, must be consistent with the corresponding prices.

Statistics Finland publishes new statistical data at 8 am on weekdays in its web service. The release times of statistics are given in advance in the release calendar available in the web service. The data become public after they have been updated in the web service.

Further information: Publication principles for statistics at Statistics Finland

Statistics Finland's release calendar: Future publications

Future publications of the statistics can be found on the page of the statistics at: Future publications of the statistics

The data are released to all users at the same time. Statistical data may be processed at Statistics Finland and information on them may be given before release only by persons involved in the production of the statistics concerned or who need the data of the statistics concerned in their own work before the data are published.

Further information: Publication principles for statistics

Unless otherwise specifically stated in connection with the product, data or service concerned, Statistics Finland is the producer and copyright owner of the data. The terms of use for statistical data.

Statistics Finland publishes data on price levels of private consumption once a year in June.

Eurostat publishes purchasing power parity and price level results three times a year. See above for Timeliness.

Statistics Finland publishes data on private consumption price levels annually in June. The release is published annually on the home page of the statistics.

Eurostat, which coordinates the European Comparison Programme (ECP), updates four Statistics Explained articles in English on its website:

• Comparative price levels for food, beverages and tobacco
• Comparative price levels for investment
• Comparative price levels of consumer goods and services
• GDP per capita, consumption per capita and price level indices

The database tables of the statistics can be found in the StatFin database.

Eurostat database tables can be found online: Eurostat > Economy and finance > Prices > Purchasing power parities (prc_ppp)

Results at a more detailed level than the analytical categories (64 pcs) are not generally public, nor available. It is possible to apply for an exemption for academic studies for the use of more detailed level data. The application is made to Eurostat and the instructions can be found on Eurostat's website.

Latest version of the handbook EUROSTAT-OECD The methodological manual on purchasing power parities is available in electronic format on Eurostat's website.

The data protection of data collected for statistical purposes is guaranteed. The compilation of statistics is guided by the Statistics Act. Alongside the Statistics Act, the EU’s General Data Protection Regulation and the Finnish Data Protection Act are applied to the processing of personal data. Provisions on the confidentiality of data collected for statistical purposes are laid down in the Act on the Openness of Government Activities.

The data are processed only by persons who need the data in their work. The use of data is restricted by usage rights. All persons employed by Statistics Finland have signed a pledge of secrecy, where they have obliged to keep secret the data prescribed as confidential by virtue of the Statistics Act or the Act on the Openness of Government Activities.

Further information: Data protection | Statistics Finland (stat.fi)

The datasets are protected at all stages of the processing with the necessary physical and technical solutions. Statistics Finland has drawn up detailed regulations and instructions for the confidential handling of data. Staff only have access to information necessary for their duties.

No business-specific information is passed on as identifiable information. At the stage of inter-country validation, only country-representative average prices can be seen by other countries. The data are only published as index-based statistics at the product group level. The data of an individual store or product cannot be identified.