Canada’s Provincial and Territorial Economic Accounts

Canada’s Provincial and

Territorial Economic

Accounts

Arthur Berger

Regional Products and Income Accounts, Beijing, China, 15-19 March 2010

2

Outline

1.

Regional Economic Accounts: Canadian context

2.

Regional Input Output Tables

3.

Regional Income and Expenditure Accounts

4.

Regional GDP by industry

Statistics Canada • Statistique Canada 2020-04-09

3

Part 1: Canadian context

Principles for Canadian regional accounts:

 Integration of accounts – Input Output, Income &

Expenditure Accounts, GDP by industry

 Standardization – common survey frame, classification systems, chart of accounts

 Coherence – establish control totals & adjust detail to add up to total

 Use administrative data and survey data


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Part 1: Canadian context

Legislative Requirements:

 Value added tax collected by federal government on behalf of provinces, allocated to those provinces based on regional economic accounts expenditure estimates

 Federal transfer payments to provincial governments also based on regional accounts data


Part 2: Regional Input Output Tables

Topics

 Timing

 Detail

 Benchmarking role

 Data sources

 Balancing

 Deflation

Statistics Canada • Statistique Canada

5 2020-04-09


Timing:

 Annual regional Input Output tables are published 34 months after the reference period

 For example, 2006 I/O tables were published in

November 2009

 National I/O tables are published concurrently with the regional tables

 Most source data available 15 months after reference period, but some as late as 24 months

Statistics Canada • Statistique Canada 2020-04-09 6


Detail:

 Regional I/O tables are broken down into 300 industries, 727 commodities, 170 final demand categories

 This is the same detail found in the national I/O tables



Imports & Exports Detail:

 727 commodities

 13 provinces and territories + rest of world

 Example: exports of bank and investment commissions from Ontario province to Quebec province were $600M in 2006



Benchmarking Role:

 Regional I/O tables provide C$ benchmark for regional income and expenditure based GDP, and regional value added by industry

 Regional I/O tables add-up to the national I/O tables

 National K$ I/O tables provide benchmark for national real GDP by industry



Data Sources:

 Industry estimates

 Final demand estimates

10



Data Sources – Industry Estimates:

 Annual surveys, mostly establishment based, sampling designed to produce accurate estimates by province

 Samples are usually divided into three strata:

• take all (large companies that operate in more than one industry and/or more than one province)

• take some (medium sized companies)

• take none (smaller companies that operate in only one province and only one industry)

 Income tax data is used for take none stratum



Data Sources – Industry Estimates:

 Other sources

• Labour expenses by industry – taxation data

• Construction – capital expenditure survey for output

• Financial industries – administrative data + enterprise survey data

• Income tax data + occasional surveys



Data Sources – Final Demand Estimates:

 Personal expenditures: retail trade survey + survey of household spending + service industry surveys + administrative data

 Capital expenditures: capital expenditure survey

 Investment in inventories: industry surveys

 Government current expenditures: public accounts

 International imports and exports: customs data (data exchange with

USA) for merchandise, survey data for services

 Inter-provincial imports and exports: combination of survey data and modeling



Balancing:

 National & provincial/territorial supply/use data are balanced in successive iterations

 National balancing adjustments serve as a guide for provincial/territorial adjustments

 Implications at provincial/territorial level provide feedback loop for re-adjusting national estimates (i.e.

Petroleum extraction = 7% of national GDP, 31% of

Alberta provincial GDP)



Deflation:

 Regional I/O tables are in C$ only.

 National I/O tables are deflated to K$.

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Part 3: Regional Income and Expenditure

Accounts

Topics

 Timing

 Benchmarking

 Detail

 Data Sources

 Deflation



Accounts

Timing:

 Preliminary estimates published 4 months after reference period (i.e. 2008 estimates published April

2009)

 Revised estimates for most recent 4 years published 7 months later (i.e. 2005-2008 revised estimates published

November 2009)

 Revisions incorporate most recent I/O tables + all other new information



Accounts

Timing (continued):

 National IEA revised estimates for most recent 4 years published in May (i.e. 2005-2008 revised estimates published May 2009)

 Plan to move to single annual release of regional IEA, concurrent with national IEA by

May 2013



Accounts

Benchmarking:

 Regional IEA C$ benchmarked to regional I/O C$ (up to 2006 so far)

 Regional IEA C$ benchmarked to national IEA C$ (2007 & 2008)

 Regional IEA K$ benchmarked to national IEA K$ (all years)

 National IEA C$ benchmarked to national I/O C$

 National IEA K$ not benchmarked to national I/O K$

 National and regional GDP in IEA very similar to national and regional GDP by industry, but not identical



Accounts

Detail - Aggregates:

 GDP at market prices income based (C$) and expenditure based (C$ & K$)

 Net Domestic Product at basic prices(C$)



Accounts

Detail - Income:

 Labour Income – 16 industrial sectors

 Corporate Profits – total economy; no industrial detail



Accounts

Detail – Expenditures:

 Personal Expenditures: about 60 categories of goods and services

 Capital Expenditure:

• Residential structures, buildings, engineering structures, 10 categories of machinery & equipment

• All broken down by government and business



Accounts

Detail – Expenditures (continued):

 Imports and Exports: 9 goods categories, 5 service categories

23



Accounts

Detail – Sector Accounts:

 Sources and disposition of personal income

(includes persons, unincorporated businesses and non-profit institutions serving households)

 Government sector tax revenue, investment income, transfer payments, subsidies



Accounts

Data Sources:

 Corporate profits – quarterly survey of financial statements, income tax data

 Labour income – monthly household survey of labour force, monthly payroll survey, administrative data



Accounts

Data Sources (continued):

 Personal expenditures - monthly retail trade survey, annual survey of household spending, service industry surveys, administrative data

 Capital expenditures - annual capital expenditure survey, monthly construction payroll data, monthly manufacturing survey (shipments of building materials and machinery and equipment) and international trade data ( machinery and equipment)



Accounts

Data Sources (continued):

 International merchandise trade – monthly customs data

(provincial allocation is challenging)

 International services trade – quarterly and annual surveys

 Inter-provincial trade – model based on input output tables trade flows & aggregate production and demand data



Accounts

Deflation:

 Personal expenditures – consumer price index

 Engineering construction expenditures – labour and material input prices

 Home & building construction expenditures – building price index

 Machinery and equipment – machinery and equipment price indexes



Accounts

Deflation:

 Government current expenditures – hourly wages of government employees

 Exports – unit values, domestic producer price indexes

(exchange rate pass-through assumption)

 Imports - unit values, foreign producer price indexes

(exchange rate pass-through assumption)


Part 4: Regional GDP by industry

Topics

 Timing

 Detail

 Data Sources

 Deflation



Timing:

 Same publication dates as the regional income and expenditure accounts

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Detail:

 Same level of industry detail as found in the regional input-output tables

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Data Sources:

 Monthly and annual industry surveys

 Monthly payroll survey

 Administrative data



Deflation:

34


Reference Documents

 Guide to the Income and Expenditure Accounts, Catalogue no.

13-017-X, www.statcan.gc.ca

 Gross Domestic Product by Industry Sources and Methods with Industry Details, Catalogue no. 15-548-XIE, www.statcan.gc.ca

 Chain Fisher Volume Index Methodology, Catalogue no. 13-604-

MIE — No. 42, www.statcan.gc.ca


Canada’s Provincial and Territorial Economic Accounts

Canada’s Provincial and

Territorial Economic

Accounts

Outline

Part 1: Canadian context

Part 1: Canadian context

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Canada’s Provincial and Territorial Economic Accounts