Term:
Input price approach
Definition:

The approach used to obtain PPPs for non-market services. Because there are no economically significant prices with which to value the outputs of these services, national accountants follow the convention of estimating the expenditures on non-market services by summing the costs of the inputs required to produce them. PPPs for non-market services are calculated with input prices as these are the prices that are consistent with the prices underlying the estimated expenditures.

Domain:
Finance
Source:
OECD
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