[{"data":1,"prerenderedAt":-1},["ShallowReactive",2],{"doc-detail-113012-en":3,"doc-seo-113012-105":29,"detail-sidebar-cat-0-en-105":82},{"code":4,"msg":5,"data":6},0,"success",{"doc_id":7,"user_id":8,"nickname":9,"user_avatar":10,"doc_module":4,"category_id":11,"category_name":12,"doc_title":13,"doc_description":14,"doc_content":15,"file_id":16,"file_url":17,"file_type":18,"file_size":19,"view_count":4,"is_deleted":4,"is_public":20,"is_downloadable":20,"audit_status":20,"page_count":21,"language":22,"language_code":23,"site_id":24,"html_lang":23,"table_of_contents":25,"faqs":26,"seo_title":13,"seo_description":14,"update_tm":27,"read_time":28},113012,13056703020460,"Valentina","https://ap-avatar.wpscdn.com/avatar/be000253dac470eee5d?_k=1778207105932848923",8,"Research & Report","Comparing Costs of Living across World Cities - Supplementary Article","This paper compares costs of living across world cities using the International Comparison Program (ICP) approach. The ICP provides price levels across economies for calculating purchasing power parity with extensive price data and rigorous methodology, which is primarily reported at the national level. Through modifications, city-level comparisons become feasible. Applying ICP methods to EIU city price data gives broadly consistent results: richer cities show higher price levels, and rankings are similar, though notable differences arise in some nonfood items and among low-price cities.","Pub lic Disclosure Authorized Pub lic Disclosure Authorized  \nThe World Bank Economic Review, 34(Supplement), 2020, S79–S88 doi: 10.1093/wber/lhz037 Supplementary Article  \nComparing Costs of Living across World Cities  \nShohei Nakamura, Rawaa Harati, Somik V. Lall, Yuri M. Dikhanov, Nada Hamadeh, William Vigil Oliver, Marko Olavi Rissanen,  \nand Mizuki Yamanaka  \nAbstract  \nThis paper compares costs of living across world cities. The International Comparison Program (ICP) reports price levels across world economies in its calculation of purchasing power parity through an extensive scale of price data collection and rigorous methodology. While the price levels are reported only at the national level, some modification makes it possible to compare the cost of living across a group of world cities. In addition, various agencies report costs of living rankings for world cities on a regular basis, and some of them, such asthe Economist Intelligence Unit (EIU)’s World Cost of Living Survey, systematically collect a wide variety of items from a host of cities, even covering low-income countries. This article’s application of the ICP method to the EIU price data yields an overall reasonable result: richer cities have higher price levels, and the rankings of cities based on their price levels are similar when using the ICP and EIU data. Nevertheless, the results based on the EIU data differ from the ICP data relatively widely in some nonfood items and among cities with low price levels. This result highlights important issues regarding the data and methodology required to measure costs of living for development purposes.  \nJEL classification: E31, O47, R32  \nKeywords: purchasing power parity, price level, urbanization, International Comparison Program, Sub-Saharan Africa  \n1. Introduction  \nThe cost of living (COL) in a city and comparison with other cities comprise important information for development policy in several aspects. First, welfare and poverty measurements require a COL adjustment. Comparing household consumption aggregates across space, such as urban and rural areas, without taking account of spatial differentials in the COL could result in underestimation of poverty in areas with higher price levels (Ravallion 2008) . Some empirical studies find the significant impacts of spatial price adjustment on welfare and poverty measurements (e.g., Jolliffe, Datt, and Sharma 2004; Gibson, Le, and Kim 2017 ) . Second, the COL is a key determinant for the productivity and population size of cities. High costs inhibit firms’ production of tradable goods by raising the level of nominal wages and making firms less competitive (Venables 2017). This may be particularly constraining for African cities, which mostly produce nontradable goods and services (Lall, Henderson, and Venables 2017) . Together with the shape  \nShohei Nakamura (corresponding author, e-mail: [snakamura@worldbank.org](snakamura@worldbank.org)). The authors would like to thank the participants in the 2016 ABCDE Conference at the World Bank for their useful comments. The authors are also grateful to the Economist Intelligence Unit for permission to use the City Data.  \n© The Author(s) 2019 . Published by Oxford University Press on behalf of the International Bank for Reconstruction and Development / THE WORLD BANK.  \nAll rights reserved. For permissions, please e-mail: [journals.permissions@oup.com](journals.permissions@oup.com)  \nDownloaded from [https://academic.oup.com/wber/article/34/Supplement_1/S79/5671691](https://academic.oup.com/wber/article/34/Supplement_1/S79/5671691) by guest on 23 June 2021  \nof a wage curve, in theory, the COL also influences the population size of a city (Duranton 2008). Thus, appropriately measuring the COL across cities is an essential task.  \nHowever, measuring spatial differences in the COL requires a non-trivial effort due to a number of methodological challenges. Unlike the consumer price index (CPI), which measures temporal change","cbCaicgXkbwK5GWG","https://ap.wps.com/l/cbCaicgXkbwK5GWG","pdf",435364,1,10,"English","en",105,"# Introduction\n## Spatial price adjustment and development policy\n## Challenges in measuring city cost-of-living differences\n## ICP methodology and limitations\n## City cost-of-living rankings by private agencies","[{\"question\":\"What differences are observed when applying the ICP method to EIU price data?\",\"answer\":\"Results are generally reasonable: higher-income cities have higher price levels and ranking patterns are similar. However, discrepancies appear relatively widely for some nonfood items and for cities with low price levels.\"}]",1784498943,25,{"code":4,"msg":30,"data":31},"ok",{"site_id":24,"language":23,"slug":32,"title":13,"keywords":33,"description":14,"schema_data":34,"social_meta":77,"head_meta":79,"extra_data":81,"updated_unix":27},"comparing-costs-of-living-across-world-cities-supplementary-article","",{"@graph":35,"@context":76},[36,53,67],{"@type":37,"itemListElement":38},"BreadcrumbList",[39,43,47,50],{"item":40,"name":41,"@type":42,"position":20},"https://docshare.wps.com","Home","ListItem",{"item":44,"name":45,"@type":42,"position":46},"https://docshare.wps.com/document/","Document",2,{"item":48,"name":12,"@type":42,"position":49},"https://docshare.wps.com/document/research-report/",3,{"item":51,"name":13,"@type":42,"position":52},"https://docshare.wps.com/document/comparing-costs-of-living-across-world-cities-supplementary-article/113012/",4,{"url":51,"name":13,"@type":54,"author":55,"headline":13,"publisher":57,"fileFormat":60,"inLanguage":23,"description":14,"dateModified":61,"datePublished":61,"encodingFormat":60,"isAccessibleForFree":62,"interactionStatistic":63},"DigitalDocument",{"name":9,"@type":56},"Person",{"url":40,"name":58,"@type":59},"DocShare","Organization","application/pdf","2026-07-19",true,{"@type":64,"interactionType":65,"userInteractionCount":4},"InteractionCounter",{"@type":66},"ViewAction",{"@type":68,"mainEntity":69},"FAQPage",[70],{"name":71,"@type":72,"acceptedAnswer":73},"What differences are observed when applying the ICP method to EIU price data?","Question",{"text":74,"@type":75},"Results are generally reasonable: higher-income cities have higher price levels and ranking patterns are similar. 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