icp.worldbank.orgInternational Comparison Program
PPPs AND THE SUSTAINABLE DEVELOPMENT GOALS (SDGs)
Build resilient infrastructure, promote inclusive and
sustainable industrialization and foster innovation
GOAL 7
PPPs help quantify the global investment in
research and development
GOAL 9
Energy intensity is measured in PPP terms
Goal 1
PPPs are used to set the international poverty l ine
SDGs Ensure access to affordable, reliable,
sustainable and modern energy for all
GOAL 3
GDP at PPP is used in models to estimate maternal mortality
Ensure healthy lives and promote well-being for
all at all ages
GOAL 8
Labor productivity measures are estimated using PPPs
Promote sustained, inclusive and sustainable economic growth,
full and productive employment and decent work for all
End poverty in all its forms everywhere
GOAL 10
GDP at PPP is used to measure
labor share
Reduce inequality within
and among countries
icp.worldbank.orgInternational Comparison Program
PPPs AND THE REAL SIZE OF WORLD ECONOMIES
Per capita GDP (PPP-based, US$)
5000 1,000 2,000 5,000 10,000 20,000 50,000 100,000 200,000
Saudi Arabia
H o n d u ra s
U n ited K in g d o m
Switzerland
D e n m a rk
C a n a d a
Russian Fed.
Singapore
Indonesia
K e n ya
An g o la
United States
Ja p a n
Ita ly
Egypt, Arab. Rep.
Ma la ys ia
United Arab Emirates
C h ile
No rwa y
Portugal
Qatar
Sudan
Ethiopia
Macao SAR, China
L u xe m b o u rg
B u ru n d i
C o m o ro s
L ib e riaMo z a m b iq u e
Fiji
B a h a m a s
South Africa
ChinaNigeria
Pakistan
France
Australia
0
20
40
60
80
100
120
140
160
180
200
Pric
e le
vel i
ndex
(wor
ld a
vera
ge =
100
)
SingletonsCaribbean Western AsiaLatin AmericaEurostat-OECDCISAsia and the PacificAfrica
African low-income economies
Middle-income economies
Eurostat-OECD high-income economies
Small high-incomeeconomies
G e rm a n y
India
Brazil
Small high-incomeeconomies
Price levels, standards of living and size of economies, 2011
Source: International Comparison Program (2015). Purchasing Power Parities and the Real Size of World Economies: A Comprehensive Report of the 2011 ICP.
icp.worldbank.orgInternational Comparison Program
PPPs IN POVERTY MEASUREMENT
0 20 40 60
World
Europe and Northern America
Australia and New Zealand
Northern Africa and Western Asia
Eastern and South-Eastern Asia
Latin America and the Caribbean
Central and Southern Asia
Oceania*
Sub-Saharan Africa
Population living on less than 2011 PPP $1.90 a dayShare (%)
20131999
To answer this and other questions on global poverty, the World Bank and the United Nations use an international poverty line anchored to the 2011 ICP PPPs. This line acts as a cut-off point that separates those living above or below the US$1.90/day (in 2011 PPP terms) threshold.
Proportion of population living below US$ 1.90/ day (2011 PPP), 1999 and 2013 (%)
What percentage of people around the world live on less than US$1.90/day?
Note: Oceania* refers to Oceania excluding Australia and New Zealand.
Source: United Nations (2017). The Sustainable Development Goals Report 2017.
icp.worldbank.orgInternational Comparison Program
PPPs AND THE ENVIRONMENT
CO2 emissions (kg per PPP $ of GDP), 2014
0.02 1.03CO2 emissions (kg per PPP $ of GDP)
Source: World Bank Open Data (2018).
How can we compare the level of CO2 emissions across the world?
icp.worldbank.orgInternational Comparison Program
PPPs IN HUMAN DEVELOPMENT
PPPs are instrumental for comparing health and education expenditures and costs around the world
Source: World Bank (2016). Montenegro - Achieving Sustainable and Inclusive Growth Amidst High Volatility Project.
Total Health Expenditure and GDP per capita in Eastern Europe and Central Asia, 1995-2013
ALB
AZE
BLRBIH
BGR
HRV
KAZ
KGZ
MKD
MDA
MNE
POL
ROM
RUSSRB
TJK
TUR
TKM
UKR
UZB
GEO
ALB
AZE
BLRBIH
BGR
HRV
KAZ
KGZ
MKD
MDA
MNE
POL
ROM
RUS
SRB
TJK
TUR
TKM
UKR
UZB
GEO
0
200
400
600
800
1,000
1,200
1,400
1,600
0 4,000 8,000 12,000 16,000 20,000 24,000
Heal
th e
xpen
ditu
re p
er c
apita
, PPP
(con
stan
t 201
1 in
tern
atio
nal $
)
GDP per capita, PPP (constant 2011 international $)
Linear (1995‐2004 average) Linear (2005‐2013 average)
1995‐2004 average 2005‐2013 average
Spending on Public Education, an International Perspective, 2012/2013
Source: World Bank (2017). Sri Lanka Education Sector Assessment: Achievements, Challenges, and Policy Options.
Brazil
MalaysiaMexicoSouth Africa
Thailand
Chile
Korea, Rep.
Indonesia
Sri Lanka
0 10,000 20,000 30,000
5
10
15
20
25
30
35
40
Shar
e of
tota
l gov
ernm
ent e
xpen
ditu
res
(%)
GDP per capita (purchasing power parity)
Source: EdStats, 2012/13 or nearest year available. Note: Bubble size corresponds to public spending as a share of GDP.
GDP per capita, PPP (constant 2011 international $)
Brazil
MalaysiaMexicoSouth Africa
Thailand
Chile
Korea, Rep.
Indonesia
Sri Lanka
0 10,000 20,000 30,000
5
10
15
20
25
30
35
40
Shar
e of
tota
l gov
ernm
ent e
xpen
ditu
res
(%)
GDP per capita (purchasing power parity)
Source: EdStats, 2012/13 or nearest year available. Note: Bubble size corresponds to public spending as a share of GDP.
GDP per capita, PPP (constant 2011 international $)
icp.worldbank.orgInternational Comparison Program
PPPs IN TRADE, COMPETITIVENESS AND PRODUCTIVITY
PPPs are used for comparing competitiveness and labor productivity across countries and regions
GCI pillar
1
2
3
4
5
6
7
Best global
Average LACBest LAC
Worst LACMedian LAC
InnovationBusinesssophistication
Market size
Technological readiness
Financial market
development
Labor market
efficiency
Goods market
efficiency
Highereducation
and training
Health and primary
education
Macro-economic
environment
InfrastructureInstitutions
Luxembourg
NewZealand
SwitzerlandSingapore
Singapore
FinlandNorway
Panama
Chile
Costa Rica
Chile
Costa Rica
Panama Costa Rica
Hong KongSAR
PanamaJamaica
Uruguay
Finland
Uruguay
China
BrazilSwitzerlandSwitzerland
0
20
40
60
80
100
South Asia Middle East(excluding N. Africa)
Latin America and the Caribbean
East Asiaand Pacific
Africa Central andEastern Europe
Annual output/worker (US$ PPP, in thousands)
Source: World Economic Forum (2017). The Global Competitiveness Report 2017-2018.
Global Competitiveness Index score range for Latin American and the Caribbean across the 12 pillars, 2017-2018
GCI pillar
1
2
3
4
5
6
7
Best global
Average LACBest LAC
Worst LACMedian LAC
InnovationBusinesssophistication
Market size
Technological readiness
Financial market
development
Labor market
efficiency
Goods market
efficiency
Highereducation
and training
Health and primary
education
Macro-economic
environment
InfrastructureInstitutions
Luxembourg
NewZealand
SwitzerlandSingapore
Singapore
FinlandNorway
Panama
Chile
Costa Rica
Chile
Costa Rica
Panama Costa Rica
Hong KongSAR
PanamaJamaica
Uruguay
Finland
Uruguay
China
BrazilSwitzerlandSwitzerland
0
20
40
60
80
100
South Asia Middle East(excluding N. Africa)
Latin America and the Caribbean
East Asiaand Pacific
Africa Central andEastern Europe
Annual output/worker (US$ PPP, in thousands)
Estimates of average labor productivity across regions, 2015
Source: World Bank (2017). The Africa competitiveness report 2017 - Addressing Africa’s demographic dividend.
icp.worldbank.orgInternational Comparison Program
R12
R6
R9
R11
R10
R8
R2
R5
R3
R7
R1
CAR
NCR
R4B
R4A
CARAGA
ARMM
Global PPPs can be used to adjust for price differences between countries. Subnational PPPs, on the other hand, can be used to adjust for price differences within a country, say, states in Brazil, emirates in the UAE, or regions in the Philippines.
SUBNATIONAL PPPs
Source: Dikhanov, Palayandy, and Capilit (2011). Subnational Purchasing Power Parities toward Integration of ICP and CPI: The Case of the Philippines.
Personal Consumption Expenditure, Quarterly Regional Price Index, the
Philippines, 2005–2010
0.85
0.95
1.05
1.15
1.25
1.35
1.45
Q4Q3Q2Q1Q4Q3Q2Q1Q4Q3Q2Q1Q4Q3Q2Q1Q4Q3Q2Q1Q4Q3Q2Q1
201020092008200720062005
R12
R6
R9
R11
R10
R8
R2
R5
R3
PHI
R7
R1
CAR
R4B
R4A
CARAGA
NCR
ARMM
Pric
e Le
vels
: Phi
lippi
nes
Q1
2005
= 1
.00
Note: Price levels by region are presented relative to the Philippines national average price level in the first quarter of 2005.