Purchasing Power Parity Apply For International Economy Comparison

The paper summarized the theory and practice of the international economy comparison, aimed at its merit and shortcoming, the author put forward the solution.In the paper, the author put the key analysis on the international comparison program (ICP) which is very popular in the academic circles' international comparison method based on Purchasing Power Parity. In order to overcome its practical difficulty and inaccurate, the author tallied up more viable method .The method still take the Purchasing Power Parity as foundation, but make use of"bridge"to complete the international comparison which can be called"deduction by hand over". However, the theory still have its problem, that is the area which chosen in the pre-scholar's article has no representation, which directly incurred the inaccuracy of the result. Therefore, at the end of the article, the author put forward the solution to resolve the representative's problem with Principal Component Analysis method.