Purchasing power parities

Purchasing power parities represent the purchasing power of the national currency of the different countries. In their simplest form, purchasing power parities are price ratios for an identical product in two or more countries in the respective local currencies.

If a kilo of apples (Granny Smith, 1A quality) cost €2 in France and CHF 5 in Switzerland, purchasing power parity in Switzerland has a ratio to France of CHF 2.50 to €1. These simple price relationships are then aggregated over larger product groups to the gross domestic product.

The national statistical offices annually survey the prices of around 12 000 products from various areas such as food, clothing, transport services, health services and the construction sector. Subsequently, analytical categories (such as “food and non-alcoholic beverages”, “clothing and footwear”, “health care” or “transport”) are formed. These are included in the superordinate aggregates “actual individual consumption”, “actual collective consumption” and “gross fixed capital formation” which ultimately make up the GDP.

Purchasing power parities (in national currencies per EUR), 2019 (provisional), EU27 = 1 EUR, selected countries
  Gross domestic product Actual individual consumption
Actual collective consumption Gross fixed capital formation
Switzerland
(in CHF)
1.72625 1.94020 2.00509 1.51874
Germany
(in EUR)
1.10576 1.07781 1.23754 1.20796
France
(in EUR)
1.08767 1.09955 1.23837 1.02008
Italy
(in EUR)
0.99539 1.02940 1.07540 0.87903
Austria
(in EUR)
1.13661 1.18478 1.17158 1.05062
European Union
(27 Countries, in EUR)
1.00000 1.00000 1.00000 1.00000
EU without United Kingdom Source: EUROSTAT. Database updated on 15.12.2020

In 2019, a particular basket with identical benefit cost CHF 173 in Switzerland, €111 in Germany, €109 in France, €100 in Italy and in €114 in Austria. It cost €100 on average in the 27 member states.

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