Definition: Eltetö-Köves-Szulc-Sergeev method

Category: Purchasing power parities

The Eltetö-Köves-Szulc-Sergeev method (EKS-S method) is a variant of the EKS method (Eltetö-Köves-Szulc method) for calculating PPPs (Purchasing power parities) for basic headings that, under certain circumstances, is better able to handle the asymmetry in the number of representative products priced by countries. With the EKS method, the Fisher type index is calculated as the geometric mean between two PPPs: the PPPs based on products representative in the first country and the PPPs based on products representative in the second country. Products representative in both countries are used for both PPPs. With the EKS-S method, the "Fisher type index" between two countries is calculated as the geometric mean of three PPPs: the PPPs based on products representative in both countries, the PPPs based on products representative in the first country but not the second, and the PPPs based on products representative in the second country but not the first. Symmetry is obtained by giving equal weight in the calculation to the two PPPs that are based on products representative of only one country. http://ec.europa.eu/eurostat/product?code=KS-RA-12-023&mode=view Eurostat and Organization for Economic Cooperation and Development (OECD), "Eurostat - OECD Methodological manual on purchasing power parities (2005 Edition)", Methods and Nomenclatures, Office for Official Publications of the European Communities, Luxembourg, 2006European Union, Regulation (EC) No 1445/2007 establishing rules for the provision of basic information on PPPs, Official Journal of the European Union No L 336, 20.12.2007, p. 1 - 24