l03 - sources for gdp by the production approach (eng)

8/11/2019 L03 - Sources for GDP by the Production Approach (ENG)

1/17

Quarterly National Accounts Course

Joint Vienna Institute

August 5 - 16, 2013

L-3: Sources for GDP by theProduction Approach

Reproductions of this material or any parts of it should refer to the IMF Statistics Department as the source

Lecture Outline

GDP b the roduction a roach

Main data sources

Issues in the calculation of value added

Data sources by economic activity

JVI/QNA/L3 : 2IMF Statistics Department


2/17

GDP by the Production Approach

GDP = Gross Value Added GVA at basic rices+ Taxes less subsidies on products

Most common approach in QNA

Availability of more infra-annual data

Better coverage from businesses in the short-term

Provide rowth decom osition b industr


Short-term surve s b economic activit

Main sources from the Statistical Office

Industrial production

Sales/Turnover

Retail Trade

Labor force

and on prices

onsumer pr cesProduction prices

Agricultural prices

Export and import prices (or unit value indices)



3/17

Re ulator Data

Main administrative sources

Agriculture commodity prices, forestry permits, fishcatch, etc.

Mining production, building permits, vehicleregistration, tourist arrivals, etc.

Customs Revenue and Tax Systems

VAT system data on turnover and inputs

Excise, turnover and VAT taxes, import dutiesSocial security system

Wages/salaries, contributions


Government

Other sources

Budget data on revenues and expenditures

Central BankFinancial intermediation and insurance companies

Quantity information from large corporations orbusiness associations

Oil, Electricity, Communication, Transportation



4/17

Concept of value added

Gross Value Added GVA at basic rices =Gross Output (GO) at basic prices Intermediate Consumption (IC) at purchasersprices

Contribution of an industry to the total outputavailable for final uses in the economy

Non-observable concept; residual item


Double indicator methods for value added

Variables values prices volumes

GO

GVA residual implicit residual



5/17

GVA in QNA

uarterl indicators on both GO and IC arehardly available, or are of poor quality

Some exceptions: agriculture, oil, energy

Risk of erratic results (negative GVA) if IC/GO ishigh and relative prices change rapidly

to be applied at the quarterly level

Simplified approximations are needed, especially forvolume estimates


Single indicator methods for volume GVA

Out ut-related methods

Deflation of GVA with output price index

Extrapolation of GVA with volume GO

Extrapolation of GVA with physical quantity index

In ut-related methods

Deflation of GVA by an input price index

Deflation of GVA by a wage rate index

Extrapolation of GVA by an index of employment



6/17

Single indicator methods for volume GVA

Out ut index enerall more reliable than in utindex, then it should be preferred

But GVA shares of GO and IC matter (moreinputs, more likely GVA deviates from GO)

Implicit fixed ratios (VA/O, VA/IC)

prices (relative prices can change in the short term

more than technology)Desirable to show calculated GO and IC explicitly


Improving the fixed-ratio assumption

Possible to obtain GVA GO or GVA IC fromactual data rather than ratios?

Desirable if ratios are variable (looking at historicalrelationship helps)

Possibly available for public enterprises andimportant industries dominated by a few large

Input and output prices widely available, always tobe used at the most detailed level. GVA atcurrent prices should behave accordingly



7/17

Sources by Activity: Agriculture, forestry

and fishing (A)Quarterly indicators: values/quantities

Ministry of agriculture Actual harvest data Forecasts, especially for most recent quarters

Surveys (farmers, marketers, customers)Marketing organizationsPopulation/employment data (subsistence)

Aquaculture and fish catch data

ExportsAgricultural prices, or CPI/PPI components


Sources by Activity: Mining

and quarrying (B)Quarterly indicators: values/quantities

Production indexPhysical quantity indicators

Administrative data from Ministry of EnergyRoyaltiesExports

VAT data

mp oyment ours wor e + pro uct v ty tren

PPI components/specific purpose price indices



8/17

Sources by Activity: Manufacturing (C)

uarterl indicators: values uantities

Industrial production index

Surveys:

Quantity data

Sales / revenue / turnover (+ change in inventories offinished goods, W-I-P)

,

Company reports

Combination of above

PPI components/specific tariffs


Sources by Activity: Electricity

and Gas (D); Water supply (E)


Industrial production index

Physical quantity from large utility companies orauthorities

Electricity generation/consumption

Gas/water supplied




9/17

Sources by Activity: Construction (F)Quarterly indicators: values/quantities

Building permits (administrative register)Surveys: Builders (residential, non-residential) Customers of builders

Input indicators (supply of building materials)Employment/hours worked (+ productivity trend?)

-Government budget for public construction

Road constructionOutput price index or, more commonly, inputprice index (cost of materials, wage index)


Sources by Activity: Wholesale and retail

trade (G)

Conce tual issues:

Output is calculated as trade margins

Trade margins (output) = Value of sales value of goodspurchased for resale + Changes in inventories

The volume of trade margins at constant prices isproportional to the volume of goods distributed (i.e.Base ear mar in x current volume of oods



10/17

Sources by Activity: Wholesale and retail

trade (G)


Surveys of retail and wholesale sales/turnover

VAT data

Sum of trade margins from value/quantity of goodsdistributed (commodity flow by type of goods).SUT helpful

CPI/WPI/PPI components


Sources by Activity: Transportation and

storage (H)uarterl indicators: values uantitiesSurveys : revenue/quantities (passengers orpassenger-km)

VAT data (turnover)

Information from large enterprises (airlines, airports,rail, public transportation)

Frei ht: volume of oods handled

Employment/hours worked

PPI/CPI components



11/17

Sources by Activity: Accommodation and

food service activities (I)


Surveys (revenue, number of overnight stays)

VAT data

Tourist arrivals

Balance of payments travel item

Employment / hours worked

CPI components


Sources by Activity: Information and

communication (J)

uarterl indicators: values uantitiesLandline/mobile users from communication operators

Internet connections

Number subscribers TV/cable service

Gross revenue postal service

TV/radio advertising

,




12/17

Sources by Activity: Financial and

insurance activities (K)uarterl indicators: values uantitiesMoney and banking statistics

Stocks of deposits and loans, interest receivable andpayable by institutional sector (for FISIM calculation)

Activity quantity measures (number of accounts,policy-holders, transactions)

Life insurance remiums and claims

Non-life insurance (premiums and benefits)

Employment/hours workedBroad-based deflators (on deposits and lending,but not on FISIM directly)


Sources by Activity: Real estate

activities (L)


Surveys on occupancy rates

Dwelling rents

Stock of dwellings (own-account)

Administrative by-products

Real estate: land transfers

Housing price/rates



13/17

Sources by Activity: Professional, scientific

and technical activities (M)


Surveys on professional services


VAT data

Administrative by-products

Lawyers: cases/deaths/divorces/land transfers

PPI/CPI components, rates


Sources by Activity: Administrative and

support service activities (N)


Sales/Turnover


VAT data

In ut costs rates



14/17

Sources by Activity: Public administration;

Defence; Social Security (O)


Government finance statistics


Wage index/CPI


Sources by Activity: Education (P)




Wages and salaries

Quantity indicators from public/private school(number of pupils enrolled, teaching staff number)

Households survey

Wage index/CPI



15/17

Sources by Activity: Human health and

social work activities (Q)




Wages and salaries

Data from health insurance schemes

Number of patients/beds

Wage index/CPI


Sources by Activity: Arts, entertainment

and recreation (R)


Sales/turnover indexes


Expenditure on sport and gambling activities

Wage index/CPI



16/17

Sources by Activity: Other service

activities (S)


Surveys on trade unions/business associations

Government funding

VAT data


CPI rates In ut rices


Sources by Activity: Households as

employers (T)


Employment/hours worked (domestic staff servinghouseholds)

Wages and salaries

CPI for domestic staff



17/17

Taxes/Subsidies: Import Duties

uarterl indicators


Values and volumes of imports (preferably withbreakdown by type of product)


Taxes/Subsidies: VAT, others on products

uarterl indicators


Values and volumes of goods and servicesproduced/sold subject to tax/subsidy (preferably withbreakdown of goods and services that closely

correspon wit type an rate o taxes


l03 - sources for gdp by the production approach (eng)

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