Presentation on theme: "From Input-output to SUT Jörg Beutel"— Presentation transcript:
1 From Input-output to SUT Jörg Beutel Productivity in the European Union: A Comparative Industry Approach Workshop Inter-Industry Accounts WP September 2005, GroningenFrom Input-output to SUTJörg Beutel
2 Introduction Objectives Outline of present data situation Discussion of missing dataTransformation of use tables from purchasers’ prices to basic pricesTransformation of supply and use tables to input-output tablesThe dual approach: Transformation of input-output tables to supply and use tablesEmpirical example of transformation for Austria 1995Estimation of missing supply and use tables
3 Data Situation ESA 1995 The tables Earlier years 1970-1994 Annual supply and use tables starting in year 1995Five-yearly input-output tables 1995, 2000, 2005, etc.Submission mandatory for member countries of EUThe tablesSupply table at basic prices, including transformation into purchasers' pricesUse table at purchasers' pricesInput-output tables for total uses, domestic production and imports at basic pricesEarlier yearsVery few supply and use tables availableSUT mostly internal data for compilation of IOT’sVarious input-output tables with different classifications and price concepts were published
6 Challenge Earlier years 1970-1994 1995-2002 Collect supply and use tables from NewCronos (Eurostat)Compile missing supply and use tablesEstimate valuation matrices (trade and transport margins, taxes)Establish supply and use tables at basic prices for total supply, domestic production, importsEarlier yearsCollect existing SUT’s and IOT’sEstimate supply tables for existing IOT’sVarious price concepts and various classificationsEstimate use tables at basic prices for existing IOT’sEstimate missing SUT’s at basic prices for other yearsComparison with National Accounts in NewCronos
7 Valuation matrices Different valuation matrices Price concept Trade margins (wholesale trade, retail trade)Transport margins (inland, water, air and other transport)Taxes on products (product taxes, VAT)Subsidies on productsPrice conceptTransformation of use tables at purchasers prices to use tables at basic pricesTransformation of input-output tables at producers prices to basic prices
8 Access to valuation matrices Access to valuation matrices for selected countries in the course of the Eurostat data submission programmeGermany, Denmark and AustriaAustria published valuation matrices on CD-Rom in ‘Statistik Austria: Input-Output-Tabelle 1995’Tax matrices were published by Eurostat in ‘Input-Output tables 1985’ for Denmark, France, and Ireland covering 59 sectors.
9 Transformation of supply and use tables to basic prices
10 Price system of the input-output framework Basic Prices = +Taxes on products- Subsidies on Products= Producers’ prices (net of all VAT) + Non-deductible VAT = Producers’ prices (net of deductible VAT) + Trade Margins+Transport Margins= Purchasers’ prices (net of deductible VAT)
11 PRICE SYSTEM OF THE INPUT-OUTPUT FRAMEWORK FOR DENMARK 1985 (Mio. DKR)
12 Transformation of supply and use tables to IOT’s Model assumptionsProduct technology assumption (Model A)Each product is produced in its own specific way, irrespective of the industry where it is produced.Assumption of fixed industry sales structure (Model B)Each industry has its own specific sales structure, irrespective of its product mixIndustry technology assumption (Model C)Each industry has its own specific way of production, irrespective of its product mix.Assumption of fixed product sales structure (Model D)Each product has its own specific sales structure, irrespective of the industry where it is produced.
13 Transformation of supply and use tables to input-output tables
14 Model assumptions for transformation to IOT’s Product technology assumption (Model A)Widely used by countries which publish product by product IOTBelgium, Denmark, Greece, Spain, France, Italy, Austria, Portugal, Sweden, UK, Estonia, Slovakia, HungaryProblems with negativesAnalytical tables away from statistical sourcesAssumption of fixed product sales structure (Model D)Widely used by countries which publish industry by industry IOTDenmark, Netherlands, Finland, Canada, Norway, HungaryNo negativesClose to statistical sourcesOther assumptionsHybrid technology (UK), Almon procedure (Test version for NL)
15 Transformation of input-output tables to supply and use tables
16 Transformation of input-output table to use table Data situationFor earlier years often supply and use tables are not availableIf they exist they internal data of Statistical Offices for the compilation of IOT’s.Required input dataInput-output table and supply tableSupply table can be derived from benchmark years and official national accounts data.The structure of supply tables is rather stable in time.
17 Model assumptions for transformation to SUT’s Recommendation Use the complements of Model A for product by product IOT’s and Model D for industry by industry IOT’s.Product technology assumption (Model A2)Widely used by countries which publish product by product IOTTransformation to SUT is not creating negativesAssumption of fixed product sales structure (Model D2)Widely used by countries which publish industry by industry IOTTransformation may create negatives.If negatives are generated Model B2 is an option.
18 Transformation of SUT 1995 to IOT 1995 for Austria Statistik AustriaProduct by product IOT‘s were compiled which are based on product technology assumption (Model A)In the course of the transformation numerous small negative elements were generated.Large negatives are an indication for the mismatch of statistical sources with the technology assumption.The negatives were deleted in a manual balancing procedure.EUKLEMS transformationAll 4 transformation models were compiled using SAS software with dynamic data exchange with Excel filesThe results of Model A were very close to the published IOT’s.
19 Transformation of IOT 1995 to SUT 1995 for Austria EUKLEMS transformationRequired inputs are IOT 1995 and supply table 1995All 4 transformation models were compiled using SAS software with dynamic data exchange with Excel filesThe results of Model A2 were close to the published SUT.The manual balancing caused minor deviations for value added and intermediate inputs for most sectors.In some cases larger differences were caused which can be revised in a manual balancing procedure.GDP and components of value added and final demand are correct.
20 Projection of SUT‘s and IOT‘s RequirementsSupply and use tables or input-output table at basic prices for base yearReal growth rates for valued added of industries (EUK60)Real growth rates for final demand (private consumption, government consumption, gross fixed capital formation, change in stocks, exports)Real growth rate of imports
23 Eurostat method The main advantages of the Eurostat update procedure Robust update procedure at low costsLimited data requirementsOnly official sources from New Cronos are used.Integrated estimation of all four quadrants of IOTNo arbitrary changes of input coefficients as in RASRow and column totals for intermediates derived not givenStructure of final demand estimated during the iterationConsistency of supply and demand provided by io-model.Successfully implemented for DG RegioEvaluation of the European Structural Funds in Greece, Portugal, Ireland, Germany, Italy, and SpainDocumentation of updating procedures in Eurostat Input-Output Manual
25 RecommendationsClassification Data base of EUKLEMS should cover all 60 individual industries (A60) of ESA EUK60 requires the disaggregation of 10 additional industries. In consequence the supply and use tables will comprise 70 industries. The data base will always allow to aggregate the results to A60.Input-output tables Collect all input-output tables, also if supply and use tables are available. The input-output tables may be the only reliable source of import matrices.Transformation of use tables at purchasers’ prices to use tables at basic prices Establish a standard procedure for the transformation of use tables at purchasers’ prices to use tables at basic prices. Estimate or collect all recommended valuation matrices.
26 RecommendationsValuation matrices If valuation matrices are missing use reference year or reference country to blow up the valuation vectors of the supply table to a full size valuation matrix.Transformation of supply and use tables to input-output tables and vice versa Use appropriate technology assumption for the transformation of input-output tables to supply and use tables and the transformation of input-output tables to supply and use tables.Compilation of missing supply and use tables Use a projection model to compile the missing supply and use tables. The main aggregates (GDP, value added by industry, components of final demand) shall be compared with the macroeconomic data in NewCronos of Eurostat.
27 Software for transformation ExcelRestrictions for calculation of an inverse (maximum matrix size 52x52)No programme codeNot transparent for other usersSAS No restrictions for calculation of an inverseDocumentation of programme codeEasy search for programming errorsThree windows document the program code (Program), errors in the compilation procedure (Log) and the results (Output)Dynamic data exchange with Excel for input and output Excel and SASPowerful tool for complex macroeconomic modelsProfessional documentationEasy generation of tables and figures for publication
28 DocumentationCompilation of supply and use tables at basic prices Paper for the Amsterdam meeting of the Data C-ordination Group DC note1beutelc WP1.docTransformation of supply and use tables and symmetric input-output tables Numerical examples with Excel hybridrev8.xls Transformation of supply and use tables and symmetric input-output tables Empirical application for Austria 1995 with SAS and dynamic data exchange with Excel files ausut95sept05b.xls