2009 Purchasing Power Parity Update for Selected Economies in Asia and the Pacific: A Research Study

Publication | September 2012

This publication presents the methodology leading to, and resulting in purchasing power parities (PPPs) for 2009 of participating economies in the Asia and the Pacific region, updated from 2005.

Included are estimates of PPP-adjusted GDP and its major components, namely, household final consumption expenditure, actual final consumption of households, government collective final consumption expenditure, gross capital formation, and net external trade.

Major Findings

  • Economies' GDP in real terms are consistently larger than GDP in nominal terms.
  • The PRC and India account for over two-thirds of total regional real GDP.
  • The PRC and India's positions, as the biggest economies, change when per capita real GDP is considered.
  • The disparity of per capita real GDP between the richest and poorest economies is striking.
  • Per capita real expenditure indexes for different components of food reflect the diversity of consumption habits among the economies in the region.
  • Per capita real expenditures on education and health are highest among the richest economies.
  • Two-thirds of the economies have per capita expenditure on restaurants and hotels lower than the Asia average.

Methodology

The 2009 PPP Update marks another milestone in statistics for Asia and the Pacific region for four main reasons. First, ADB was able to test a cost-effective alternative approach to PPP estimation during non benchmark years with the core list approach. Second, price collection was limited to capital cities and, in the need to adjust capital city to national average prices, data mining from the consumer price index established the possibility of computing subnational or intra-country PPPs for household final consumption expenditure. Third, the updating exercise has enabled an improved understanding of PPP concepts and methodology and once more built statistical capacity among participating ADB member economies on both price and national accounts. Finally, the data validation procedures in the 2009 PPP updating are now being adopted in selected economies for the consumer price indexes, thus improving the quality of national price statistics.

Twenty-one ADB member economies participated in the technical assistance program: Bangladesh; Bhutan; Brunei Darussalam; Cambodia; the People's Republic of China; Fiji; Hong Kong, China; India; Indonesia; the Lao People's Democratic Republic; Malaysia; the Maldives; Mongolia; Nepal; Pakistan; the Philippines; Singapore; Sri Lanka; Taipei,China; Thailand; and, Viet Nam.

Contents 

  • Foreword
  • Executive Summary
  • Introduction
  • Overview of Purchasing Power Parities
  • The 2009 Purchasing Power Parity Update in Asia and the Pacific
  • Major Results and Findings
  • Governance, Organization, and Implementation
  • Uses and Applications
  • Lessons Learned and Future Directions
  • Detailed Results
  • Appendixes