Odhad regionálních cenových hladin v České republice

This master thesis explores the topic of regional price levels, with special focus on the Czech Republic. The first part provides a theoretical framework for the concept of Purchasing Power Parity (PPP) and its use for international comparisons of economic indicators. The next part then argues that PPP on the national level is not suitable for comparing economic indicators on subnational levels. To support this, the thesis then introduces existing research on this topic, as well as various approaches to deal with the absence of regional price level data. The empirical section of this thesis then demonstrates one such approach, a simple model that estimates the regional price levels in the Czech Republic using real estate prices and population density. The obtained results are then applied to regional average wages of comparable workers and GDP, relative to the EU average.