French quaterly national accounts : Input-Output Tables methodology and indicators

Fabrice Lenglartnational account department

November, 7th 2006

French quaterly national accounts : Input-Output Tables methodology and indicators

Input-Output tablesF. Lenglartt November 7th , 2006

IO tables methodology and indicatorsProgramme›Calculation of the GDP: the 3 approaches to VA

›Calculation of the Intermediate Consumption

› The IOT-SUT synthesis: an iterative process

›Calibrating and fitting

› Indicators used

› Link with institutional sector accounts


Globally speaking, « TES », is an integrated presentation of IO tables and SU tables

RESOURCESBY

PRODUCTS

INTERMEDIATE CONSUMPTIONTABLE BY

PRODUCTS x INDUSTRIES

FINAL USESBY

PRODUCTS

PRODUCTION ACCOUNTSBY

INDUSTRIES

GENERATION OF INCOME ACCOUNTS…

SECTOR ACCOUNTS

SUT


Products

« Industries »

Resources = IC +IC + IC + final uses

= VA

= VA

= VA

P-

P-

P-


Calculation of the GDPthe 3 approaches to VA›GDP = Σ VA

+ Taxes on products (T) - Subsidies on products (S)

› 3 approaches to VA…–output approach = “by industry" approach (Supply and

Use table SUT and Input-Output table IOT) : VA = P1 – P2–expenditure approach = “by product” approach (supply

and use balances) from the use side–income approach : generation of income accounts by

industries and sector accounts


Calculation of the GDPfrom one approach to the two others›We start with the "by industry" approach

GDP = Σ output – IC + Taxes on products (T) - Subsidies on products (S)

› Then, using the SUT / IOT relationships between industries and products (supply and use balances)

Output + T-S + M +T&TM = IU + FU and Σ IU = Σ IC

›we obtain the two other approaches:–expenditure approach = “by product” approach (supply

and use balances) all products but administration–income approach = generation of income accounts by

branches and sector accounts administration industry


Calculation of the GDPthe two expenditure approaches› Among which we choose two

–“By product” approach on the supply side for “goods”VA = Outputg – IUg + Tg-Sg

Agriculture & fishery + all manufacturing goods + oil + transportation

–“By product” approach on the use side for “services”VAs = FUs

water & gas & electricity + construction + market services

–income approachVAa + ICa

administration industry


Calculation of the GDPstructure of the SUT and IOT› “Goods” on the supply side because the supply and use

balances are balanced by the change in inventories (part of FU)

› “Services” on the use side because the supply and use balances are balanced by the output

›We don’t want the GDP to include discrepancies between supply and uses in the SUT.


Calculation of the intermediate consumptions

› IC are calculated in the QNA similarly to their annual equivalent

› For the branch b and the product p:ICb(p) = b(p) Pb

› (technical coefficients) are based on the forecasting of the present year, using the information from the past (level and trends), assuming that there is no sudden major change in the technology of production


Before starting the IOT-SUT synthesis

RESSOURCES EMPLOISProd Impôts sur produits Sub MC MT Imp Emplois intermédiaires emplois finals

TVA d212 sur EF sur EI EA-EF FG2 EJ EH EM BUF, ER Conso, stockssur EF sur EI d214 FG1 EK EL FN4 FP2 FBCF,

FQB FN1 FN2 FP3 FQ1 ExportFN3 FP1 FQA

EA-EFFG1 EKFQBFG2 EJEL FN1 FN1 FN2FN3 FP1EH EM FN4 FP2FP3 FQ1FQABUF, ERER

ER

Ressources Uses

output

Taxes on products

VAT

Trade Marg. Transport m

arg.

Intermed. uses Final uses

on FU

on IU

on IU

on FU

Ch.

Inventories

Agric. Manuf oil, transp

WGE, services

Transp.,

constr., trade


First calculation of ICs





ER

Ressources Uses

output

Taxes on products

VAT

on FU

on IU

Trade Marg.

on FU

on IU

Transport m

arg.


Ch.

Inventories


WGE, services

Transp.,

constr., trade


First partial balancing





ER

Ressources Uses

output

Taxes on products

VAT

on FU

on IU

Trade Marg.

on FU

on IU

Transport m

arg.


Ch.

Inventories


WGE, services

Transp.,

constr., trade


Second calculation of ICs





ER

Ressources Uses

output

Taxes on products

VAT

on FU

on IU

Trade Marg.

on FU

on IU

Transport m

arg.


Ch.

Inventories


WGE, services

Transp.,

constr., trade


Calculation of TMs = “MC” on IUs & First calculation of VAT on IUs





ER

Ressources Uses

output

Taxes on products

VAT

on FU

on IU

Trade Marg.

on FU

on IU

Transport m

arg.


Ch.

Inventories


WGE, services

Transp.,

constr., trade


Second partial balancing





ER

Ressources Uses

output

Taxes on products

VAT

on FU

on IU

Trade Marg.

on FU

on IU

Transport m

arg.


Ch.

Inventories


WGE, services

Transp.,

constr., trade


Third calculation of ICs





ER

Ressources Uses

output

Taxes on products

VAT

on FU

on IU

Trade Marg.

on FU

on IU

Transport m

arg.


Ch.

Inventories


WGE, services

Transp.,

constr., trade


Last calculation of VAT on IUs and TMs





ER

Ressources Uses

output

Taxes on products

VAT

on FU

on IU

Trade Marg.

on FU

on IU

Transport m

arg.


Ch.

Inventories


WGE, services

Transp.,

constr., trade


Balancing the SUT





ER

Ressources Uses

output

Taxes on products

VAT

on FU

on IU

Trade Marg.

on FU

on IU

Transport m

arg.


Ch.

Inventories


WGE, services

Transp.,

constr., trade


Calibrating and fitting

Available data:

› Annual account series based on comprehensive sources–Ex :Household consumption of cars

› Quarterly partial data: indicators–Vehicle registration

› Under constraint the quarterly accounts add up to annual ones

Solution=calibration/fitting


Calibrating and fittingCalibrating› Estimation of an annual relationship between annual accounts and

annualised indicator :

yyy εIβαA

qqq εIβ4

αA

›Use of the relationship on quarterly series


Calibrating and fittingFitting

yq

q,y AA

q

q,yyy AAε

q,yq,yq,y εIβ4

αA

)ε( q,y

yq

q,y

21-q,yq,y

εε

uc

)ε-ε(min

where solves


Indicators and sources

›Output–Volume indicators

‐ IPEA (INSEE) for agricultural products‐ IPI (INSEE) for all industrial products (but FE3, FC4)‐ Indexes from professional committees (oil, cars…)

–Value indicators‐VAT turnover index (INSEE)

–Price deflators‐PPI (IPPAP, IPVI INSEE)



› External trade–Value indicators

‐Customs for goods‐Balance of Payments (CB) for services

–Price deflators‐Unit Value Index (goods)‐ Internal market prices (services)

–CIF-FOB correction in order to measure FOB imports and thus FOB-FOB accounts



› Final Consumption–Volume indicators = goods

‐Numerous specific indicators (levels 100 and 300 of the classification) for goods: food industry (meat, milk, bred, tobacco…), manufacturing goods (cars = vehicle registration records, furniture, books, clothing&shoes, medicines…), energetic products (Oil, gas, electricity), water supply…

–Value indicators = services‐Specific indicators (transports, telecommunications, health sector = national health-insurance fund)

‐VAT turnover index for other products (hotels & restaurants…)

–Price deflators‐CPI (INSEE)



›GFCF–Volume indicators

‐Specific products (airplanes = Airbus fine tracking, cars = vehicle registration records)

‐Buildings (Buildings starts records, buildings modification index, housing stocks)

‐Public works

–Value indicators‐VAT turnover in wholesale of Manufacturing goods (machinery, electronics)

–Price deflators‐Buildings: Building Cost Index, cost of public works


Link with institutional sectors accounts

› The value added and the intermediate consumption by industry come from the input/output table

Value added by institutional sectorIntermediate consumption by institutional sector

Output by institutional sector


Link with institutional sectors accounts Value added by institutional sector

›Non market value added–computed by the factors’ costs for GG, HHs and NPISHs

›Market value added by institutional sector–Indicator of market value added of FCs, GG, HHs and

NIEs

= sum of VA of specific industries weighted by fixed coefficients

›Balance of the total Value added compiled in the IOT on the total VA of NFCs


Link with institutional sectors accounts Output by institutional sector

› Intermediate consumptions by industry also come from the Input/Output table

Intermediate consumption by sector

› Balancing on output

Fabrice Lenglartnational account department

November, 7th 2006

French quaterly national accounts : Input-Output Tables methodology and indicators

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French quaterly national accounts : Input-Output Tables methodology and indicators