Balassa Index Calculator

Balassa Index Calculator calculator can be used to measure the degree of international competitiveness by comparing price levels between countries.

Input Parameters

Calculation Results

Balassa Index Calculation

Balassa Index:

Where:
Balassa Index = (Home Country Price Index - Foreign Country Price Index) / Foreign Country Price Index
This index measures the degree of international competitiveness between two countries.

Balassa Index Calculator Calculator Usage Guide

Learn how to use the Balassa Index Calculator calculator and its working principles

What is the Balassa Index?

The Balassa Index (also known as the Balassa-Samuelson effect) measures the degree of international competitiveness between two countries. It compares price levels between countries to determine how competitive one country's goods and services are relative to another.

How to Use This Calculator

  1. Enter the price index of your home country (typically set to 100)
  2. Enter the price index of the foreign country you're comparing to
  3. Click the "Calculate" button to compute the Balassa Index
  4. The result will be displayed as a decimal number

Interpreting the Results

  • A Balassa Index greater than 0 indicates that your home country is more competitive
  • A Balassa Index of 0 means both countries have equal competitiveness
  • A negative Balassa Index would indicate that the foreign country is more competitive

Example

If your home country's price index is 100 and a foreign country's price index is 90, the Balassa Index would be (100-90)/90 = 0.1111, indicating your home country is approximately 11.11% more competitive.

Practical Applications

This calculator can help businesses and policymakers understand international competitiveness, identify trade advantages, and make informed decisions about market entry and pricing strategies.