vice-versa. The 1992 edition of _World Development Indicators_ (Table 30) gives a very simple view of how this is done, using _Atlas_ estimates to complete an array of ICP-based figures.

Reversing the process, estimates from ICP's 1990 Austria-FSU comparison can suggest a conversion factor to estimate $GNP per capita on the _Atlas_ scale. It will be some months before complete results are available from the 1990 ICP exercise, for Czechoslovakia, Hungary, Poland, Yugoslavia, and possibly Romania (Bulgaria is joining only for 1993); as well as FSU. In the meantime, the available 1990 data from the Austria-FSU comparison (excluding comparison-resistant items and construction) and full details from the 1985 ICP exercise (which linked Hungary, Poland, and Yugoslavia to Austria) have been blended. These suggest a PPP of about 0.56 rubles per dollar; or a GNP per capita of about 6510 on an ICP scale (referred to international dollars, or 1$). The subsequent regression work yields an Atlas-type measure of $2440 per capita for the FSU in 1990, but the regression is of doubtful validity. This approach is not recommended here for two reasons. Only preliminary results from the 1990 ICP are currently available for the FSU, and none for other HPE participants. Also, such an operationally significant use would not seem appropriate until a sensitivity analysis of the regression technique used for WD192 has been performed, using variants discussed in a working paper prepared on the subject (see Ahmad 1992). This is particularly necessary since the outcome may depend heavily on acceptance of any particular market exchange rate between the dollar and the currency of a "linkage" country, to convert the FSU's GNP into dollars. In effect, blending an exchange rate between two well developed economies (Austria and US) with PPPs linking one of them (Austria) to a planned economy (PSU) exacerbates some arcane but important methodological issues imbedded in PPP arithmetic.'2

# c. Preferred Synthetic Atlas-type Conversion Factor (SACF)

These concerns can be mitigated by using PPP linkages first from the FSU to other CMEA economies and then from those to market economies at roughly the same level of development. There are other CMEA economies, e.g., Poland, who have participated in ICP as well as CMEA exercises;'<sup>3</sup> such double-participation provides a bridge from planned to market economies at roughly the same level of development, within the same (PPP) methodology. Using a PPP bridge to transit from planned to market economies mitigates concerns about fundamental differences between the two conversion scales, with regard to how exchange rates and domestic prices inter-relate. It is the relationship between PPPs and 1<sup>2</sup> For a review of such issues **see** Hill, 1981.

t3 Hungary and Yugoslavia have also participated in **ICP** as **well** as CMEA exercises. However, Yugoslavia was never a full participant (since its trade arrangements with CMUA economies were similar to but outside formal CMEA mechanisms); and Hungary's last participation in the CMBA exercise was in 1983. In place of a 1988 CMEA exercise, Hungary and the FSU conducted a 'dry-run' ICP exercise based on 1985; this put the FSU's GNP per capita at 110134% of that for Hungary, depending on whether Hungarian or FSU expenditure patterns and price structures were taken as the reference.

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