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Structured Product Descriptions (SPDs)

For the purposes of ICP, countries are required to price comparable products selected from a common basket of goods and services. To enable countries to price comparable products, each product in the basket is defined by a product specification. The product specification details the physical and economic characteristics that influence the product’s market price. Countries price products with characteristics that match those in the product specification. The list of product specifications for the goods and services in the common basket is called a “product list”.


Prior to the 2005 comparison, product lists for a forthcoming comparison were built up from the product lists of the previous comparison or from the products lists used for Eurostat-OECD comparisons. Either way this approach was not satisfactory. Moreover, there were over ten years between the 2005 and 1993 comparisons and the product lists for 1993 were well out of date. To draw up product lists for 2005, the ICP Global Office developed a new approach involving a new product coding system and structured product descriptions (SPDs). The object of the approach was to standardize the process of identifying and defining products across regions and to facilitate the matching of products both within and between regions. The same approach is used and improved for the 2011 comparison.


SPDs are generic descriptions that list the price-determining characteristics of product clusters. Rice, shirts and trousers are examples of product clusters. A product cluster can comprise a whole basic heading as in the case of rice or a subset of the products covered by a basic heading as in the case of shirts and trousers which come under the basic heading for garments. The more heterogeneous a basic heading, the more product clusters it will contain. While these product clusters will be more homogeneous than the basic heading, they themselves will not be homogeneous as they have to allow for variation in the characteristics of the products in the cluster. To streamline the SPD approach, a common set of characteristics is defined for each basic heading as the consolidation of characteristics of all clusters under the basic heading.