Definition: Weighted CPD method

Category: Purchasing power parities

A variant of the CPD method (Country-product-dummy method) in which representative products receive a higher weight in the calculation than non-representative products. For example, representative products could have the weight of 2 or 3 and unrepresentative products a weight of 1. The choice of weights is arbitrary as it is with the EKS (Eltetö-Köves-Szulc method). However, the weights of 1 for a representative product and 0 for an unrepresentative product used in the EKS cannot be used in a weighted CDP because the assignment of 0 to prices of unrepresentative products will remove them from the calculation. http://ec.europa.eu/eurostat/product?code=KS-RA-12-023&mode=view