Albania - PPP conversion factor, GDP (LCU per international $)

The value for PPP conversion factor, GDP (LCU per international $) in Albania was 42.50 as of 2020. As the graph below shows, over the past 30 years this indicator reached a maximum value of 45.53 in 2005 and a minimum value of 2.34 in 1990.

Definition: Purchasing power parity conversion factor is the number of units of a country's currency required to buy the same amounts of goods and services in the domestic market as U.S. dollar would buy in the United States. This conversion factor is for GDP. For most economies PPP figures are extrapolated from the 2011 International Comparison Program (ICP) benchmark estimates or imputed using a statistical model based on the 2011 ICP. For 47 high- and upper middle-income economies conversion factors are provided by Eurostat and the Organisation for Economic Co-operation and Development (OECD).

Source: World Bank, International Comparison Program database.

See also:

Year Value
1990 2.34
1991 3.07
1992 9.98
1993 22.00
1994 29.27
1995 31.49
1996 35.43
1997 38.72
1998 40.72
1999 41.10
2000 42.03
2001 42.82
2002 42.93
2003 44.59
2004 44.90
2005 45.53
2006 44.41
2007 44.63
2008 44.56
2009 44.34
2010 44.20
2011 43.86
2012 43.66
2013 44.11
2014 42.89
2015 42.71
2016 42.39
2017 42.26
2018 42.30
2019 42.34
2020 42.50

Development Relevance: In a market-based economy, household, producer, and government choices about resource allocation are influenced by relative prices, including the real exchange rate, real wages, real interest rates, and other prices in the economy. Relative prices also largely reflect these agents' choices. Thus relative prices convey vital information about the interaction of economic agents in an economy and with the rest of the world.

Limitations and Exceptions: Official or market exchange rates are often used to convert economic statistics in local currencies to a common currency in order to make comparisons across countries. Since market rates reflect at best the relative prices of tradable goods, the volume of goods and services that a U.S. dollar buys in the United States may not correspond to what a U.S. dollar converted to another country's currency at the official exchange rate would buy in that country, particularly when nontradable goods and services account for a significant share of a country's output. An alternative exchange rate - the purchasing power parity (PPP) conversion factor - is preferred because it reflects differences in price levels for both tradable and nontradable goods and services and therefore provides a more meaningful comparison of real output.

Statistical Concept and Methodology: PPP rates provide a standard measure allowing comparison of real levels of expenditure between countries, just as conventional price indexes allow comparison of real values over time. PPP rates are calculated by simultaneously comparing the prices of similar goods and services among a large number of countries. In the most recent round of price surveys conducted by the International Comparison Program (ICP) in 2011, 199 economies participated. The PPP conversion factors come from three sources. For 47 high- and upper middle-income countries conversion factors are provided by Eurostat and the Organisation for Economic Co-operation and Development (OECD). For the remaining 2011 ICP countries the PPP estimates are extrapolated from the 2011 ICP benchmark results, which account for relative price changes between each economy and the United States. Extrapolation for the GDP conversion factor uses the GDP implicit deflator. For countries that did not participate in the 2011 ICP round, the PPP estimates are imputed using a statistical model. More information on the results of the 2011 ICP is available at www.worldbank.org/data/icp.

Periodicity: Annual

Classification

Topic: Economic Policy & Debt Indicators

Sub-Topic: Purchasing power parity