Section D Sources and methods for compiling an ISP
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Transcript of Section D Sources and methods for compiling an ISP
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Section DSources and methods for compiling an
ISP
Rob Pike
UK representative,
STESEG Task Force on Services
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Overview
Introduction Approach (D.1) Quality measures (D.2) Defining criteria for indicators (D.3) Proposed criteria for indicators (D.4.1) Deflators (D.4.2) Recommended variables (D.4.3)
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Introduction
Heterogeneous nature of services Wide range of current practices
– dependent on national needs & availability of data ISP manual will assist countries in:
– developing a monthly (or quarterly) ISP– improving measurement of services – increasing consistency & coherence within and outside the
OECD
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Approach
Not always practical to achieve conceptual best– financial constraints; measurement difficulties; burden on
business ISP presents 3 options:
– Preferred data source(s)– Alternative data source(s)– Other data source(s)
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Preferred, Alternative & Other
Preferred - most appropriate conceptually; but only suitable if general conditions (quality measures) met
Alternative - use if Preferred not available or if Preferred is considered unsuitable (fails quality measures)
Other - less precise measure but reasonable to use in the absence of other sources
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Quality measures
Used to assess suitability of data sources Suitability a prerequisite for conceptually appropriate
series Quality measures are broadly consistent with quality
frameworks of IMF & Eurostat Subjective approach Simple scoring system
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Quality measures
Coverage Timeliness Periodicity/frequency Accuracy Relevance Consistency
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Defining criteria for indicators
Criteria based on Eurostat Handbook on price and volume measures in national accounts
ISP manual uses same principles but with more latitude
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Eurostat price and volume handbook uses A, B, C method to evaluate appropriateness
A methods Most appropriate methods
B methods Those methods which can be applied incase an A method cannot be applied
C methods Those methods which shall not be used
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Manual assesses methods by transaction category and then by product
The manual relates to annual data Recommend the same principles should be used for sub-annual
data (although with more latitude)
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Market Output
Generally three different ways of measuring output:– Deflated turnover (using PPIs, CPIs)– Volume extrapolation using output indicators– Volume extrapolation using input indicators
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Market Output - A methods
For A methods, turnover deflated by PPIs is preferred, but it must:– be an index of the price of the output of exactly that product– take account of quality changes– be valued at basic prices
Use of CPI is an A method if output is consumed wholly by households
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The following will usually be B methods:– Turnover deflated by a less appropriate PPI (i.e. without quality
adjustments, or a smaller/larger coverage than the product heading)– A CPI that satisfies the same criteria as specified for PPIs above– Output volume indicators
Market Output - B methods
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The following will usually be C methods:– Input methods– Secondary indicators (i.e. not directly related to the output)– Deflation using PPIs / CPIs that do not correspond at all with the
product (i.e. general CPI)
Market Output - C methods
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Non-market output
Generally input volume methods are C methods for individual services and B methods for collective services
Where input volume series for collective services are fully representative, quality adjusted & detailed they would constitute A method
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Appropriateness of Eurostat handbook
Developed for annual indicators– principles hold– impractical to measure intermediate consumption– base criteria for appropriate SPI indicators broadly on
Eurostat recommendations for output
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Proposed criteria
Preferred – turnover deflated by appropriate output price – detailed appropriate volume indicators
Acceptable– turnover deflated by a less appropriate price– volume indicator (less detailed)– input series for non-market collective services
Other– input series
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Deflators
Intend to insert a section on measurement of service sector prices
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Recommended variables
Services classified by ISIC categories Short text to describe ISIC class & raise relevant
issues Explanatory notes
– what is included/excluded Preferred, Alternative & Other Some suggestions on helpful sub-division of
categories
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Way forward
Approval by STESEG & take on comments from STESEG
Complete first draft of recommended variables for all service industries & circulate to TF members for suggestions/ comments, by end 2004
Circulate to STESEG members for suggestions/ comments in 2005
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Discussion points from comments of STESEG members
- Evaluation of variables:
- need for additional criteria? Such as:
- serviceableness,
- variable’s performance relative to established benchmarks,
- proportion and effects of non-response on the data.
- Consistency with GDP?
- ISP will be benchmarked to quarterly and annual GDP?
- Data sources for ISP and GDP to be consistent.
- Invites careful study and further suggestions on tables in section D.4.2