The article tests the idea of purchasing power parity (PPP) by looking at how differences in productivity affect prices in Indonesia and Korea. They used data from 1971 to 2005 and found that in Indonesia, the Balassa-Samuelson effect (productivity differences) significantly impacts prices, both before and after the Asian currency crisis. In Korea, however, this effect was only seen before the crisis, with prices deviating from PPP after the crisis. The study also confirmed a long-term relationship between foreign exchange rates and inflation rates.