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The Geary-Khamis dollar, also known as the international dollar, is a hypothetical unit of currency that has the same purchasing power that the U.S. dollar had in the United States at a given point in time. The years 1990 or 2000 are often used as a benchmark year for comparisons that run through time.
It is based on the twin concepts of purchasing power parities (PPP) of currencies and the international average prices of commodities. It shows how much a local currency unit is worth within the country's borders. It is used to make comparisons both between countries and over time. For example, comparing per capita gross domestic product (GDP) of various countries in international dollars, rather than based simply on exchange rates, provides a more valid measure to compare standards of living. It was proposed by Roy C. Geary in 1958 and developed by Salem Hanna Khamis in 1970 to 1972.
The term, while not in widespread use, is sometimes used by international organizations such as the World Bank and the International Monetary Fund in their published statistics.
Figures expressed in international dollars cannot be converted to another country's currency using current market exchange rates; instead they must be converted using the country's PPP exchange rate used in the study.
References
- World Bank use of the term under definition of Purchasing Power Parity
- Nations and firms in the global economy Ch. 11 Globalization and economic growth
- Handbook Of The International Comparison Programme. Annex II - Methods Of Aggregation . Statistical definition at the UN United Nations Statistics Division . 2007
- Geary R.C. 1958. An International Comparison of National Products and Purchasing Power of Currencies OEEC, Paris
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