China’s Input-Output Survey andTabulation MethodComments13th OECD – NBS Workshop on National AccountsNovember 40- December 4, 2009Haikou, ChinaChina’s Input-Output Survey andTabulation MethodComments13th OECD – NBS Workshop on National AccountsNovember 40- December 4, 2009Haikou, China
Contact: nadim.ahmad@oecd.org
General Observation
•IO and SU tables are extremely importantcomponents of the national accountsframework and on-going work anddevelopments in China are welcomed andstrongly encouraged.
Detailed Comments
•Paper describes a number of surveysources used to populate the output,intermediate consumption and value-added cells in the IO table.
•52 questionnaires categorised by 3 types:
–Census questionnaires
–Focused questionnaires
–Typical questionnaires
Detailed comments
•Census questionnaires:
•Investment composition of fixed assets:+30mYuan
•Composition of manufacturing costs of the large-sized industrial enterprises above designated size:+ 5m Yuan –
–Gross industrial output and sales volume and outputof major industrial products
–Investigation information of costs and expenses ofindustrial enterprises
Detailed comments
•Points of clarification
–Not clear which enterprises are included – all? or justmanufacturing?
–How are small and medium enterprises (<5 m Y)captured?
–What use is made of the business register? And howare survey results grossed-up to the entirepopulation? What percentage of enterprises (as a percent of value-added or output are surveyed?)
–How is the business register updated?
Detailed comments
•Focused questionnaires – basic units of medium andsmall sized industrial enterprises above designated size ofconstruction and service enterprises
•Points of Clarification
–Are these questionnaires for the construction andservice industries? Or are they questionnaires thattarget expenditures on these activities by small andmedium enterprises?
Detailed comments
•Typical questionnaires – compositions oftransportation expenditures and travelling expenses etc
•Points of Clarification
–More detail required on these questionnaires? It’s notentirely clear what they are and how they are used.
Commodity by commodity
•Tables are produced on a C by C basis.
•Questions
–Given the information available to produce C by C tables itshould be possible to produce corresponding SU tables. Is thereason they are not produced because it is assumed that IOcommodity coefficients (cost structure) can be used to estimatedthe intermediate consumption and value-added of enterprises notdirectly surveyed (but which have been able to provide estimatesof output)?
–If this is the case, it is important to better understand at whatlevel of industry classification it is applied; as it presupposesstrong homogeneity in production processes – which isquestionable when comparing large and small enterprises.
–How is value-added allocated when secondary products are by-products?
General questions
•Are estimates of own-account productionmade? (software, construction etc)
•How is the informal economy (andunincorporated enterprises) measured?
•How are estimates of margins on productsderived?
•How detailed are the tables (commodityclassification)?
General questions
•Are estimates of own-account productionmade? (software, construction etc)
•How is the informal economy (andunincorporated enterprises) measured?
•How are estimates of margins on productsderived?
•How detailed are the tables (commodityclassification)?
Responding to NBS questions
•Which level of the 5 levels of CPC should be used incommodity balancing for compiling accounts of goodsand services and for balancing of further supply anduse? Could we say the 4th or the 5th level of CPC mustbe adopted?
•The SNA is not prescriptive in this regard. It dependsentirely on the information available in a country. Thegeneral principle is that the compilation of tables(especially those that require assumptions based onobserved coefficients in surveyed enterprises) should beas detailed as possible .The publication level of tableshowever need not (and rarely does) follow thecompilation level. Generally these are less detaileddepending on the quality of balancing, microdata andconfidentiality constraints.
Responding to NBS questions
•In US, information from economic census is very rich,with detailed output data of goods and services, and thecomplete output data by detailed commodity can begathered. However, for countries where there is noteconomic census yet, or just part of establishments hasbeen investigated, how are the complete output data bycommodity compiled, or how are the complete outputdata by commodity imputed?
•A business register is a pre-requisite. Most businessregisters will also provide an indication of size – eithervia turnover or employment. And this information can beused to stratify enterprises into different bands. But it isessential that at least some enterprises are surveyed ineach of these bands. Tax/administrative records providean additional useful source for compiling a BR.
Responding to NBS questions
•In addition, must the objects of investigation beestablishments? Could the enterprises be objects ofinvestigation, while the industry to which the enterprise isattached is determined by nature of the enterprise’scentral product? In other words, for better adopting thesuggestions by SNA, what are the most essentialrequirements?
•The SNA still prefers establishments. However inpractice there is an increasing tendency to collectinformation from enterprises (and this forms part of the2008 SNA research agenda). Many EU countries forexample already compile their tables using enterpriseinformation – which is useful for analytical applicationssuch as productivity measurement, R&D, innovation etc.
Responding to NBS questions
•How should auxiliary activities be captured? Are differentquestionnaires needed? How are auxiliaryactivities/expenditures allocated to commodities?
•Para 5.9 of the 1993 SNA defines ancillary activities.The costs of these activities must be allocated to usingestablishments/commodities and these can be allocatedon the basis of (preferably) value-added or outputshares.
Responding to NBS questions
•We’d like that you introduce us the main informationused and compilation procedures in compiling supplyand use tables through case studies of a developedcountry. How do you account the value added and itscomposition by industry when you compile the use table?Do you use investigation data of establishments tocalculate the value added by production approach?Whether is the operating surplus derived by aggregate ofvalue added minus the sum of the three components ofcompensation of employees, net taxes on production anddepreciation of fixed assets? Or other calculationmethods are adopted?
•See the previous US BEA presentation.
Responding to NBS questions
•When supply table and use table are compiled, whichlevel of classification by industry and by commodity isused at least?
•This varies enormously by country. It is important to notetoo that the level of detail used for compilation is usuallydifferent to that used for publication. In the EU countriesare currently required to provide tables at the NACE 60level but many produce tables at a more detailed level.
Responding to NBS questions
•How the basic price, the producer’s price and thepurchaser’s price are reflected in input-output accounts?Which kinds of taxes are included in each of them?
•The 1993 SNA provides clear guidance here. In mostcountries IO tables are produced at basic prices and sowill include other taxes and subsidies on production.Tables compiled at producers prices will additionallyinclude any taxes/subsidies on products (e.g. VAT) thatare not separately invoiced to the purchaser.
• Purchaser’s prices include all taxes/subsidies onproducts.
•Supply-use tables in theory should show value-addedand output at basic prices and consumption atpurchaser’s prices.
Responding to NBS questions
•How do you deal with value-added tax? Is the sales taxadded to the output in basic price, and the purchase taxadded to the intermediate input? Or is the “value-addedtax that should be turned over to the state” added to theoutput in basic price, while without consideration of thepurchase tax in the component of intermediate input?
•The answer depends on the valuation basis used for thetables. IO tables produced at basic prices should have aseparate row for any VAT incurred by enterprises (whichis rare for market enterprises but not for non-market andsmall enterprises). In other words for IO tables at basicprices output should not include VAT neither should anyof the transactions between industries/commodities.
Inter-relationship between China’s IOestimation, production-based GDP andexpenditure based GDP13th OECD – NBS Workshop on National AccountsNovember 40- December 4, 2009Haikou, ChinaInter-relationship between China’s IOestimation, production-based GDP andexpenditure based GDP13th OECD – NBS Workshop on National AccountsNovember 40- December 4, 2009Haikou, China
Contact: nadim.ahmad@oecd.org
General Comments
•Recommended reading – 8th Workshop onNational Accounts:
•5. Accounting frameworks for constantprice measures- GDP Balancing in Constant and CurrentPrices, Mr. AHMAD Nadim, OECD