Method of GDP Estimation in the Year of
the First Economic Census of China
Outline
XU Xianchun
Director-general of Department of National
Accounts, National Bureau of Statistics
July 28, 2005
1
Content
I.
Significance of economic census for improving GDP estimation in China
II.
Purpose of formulating a plan of GDP estimation in the year of economic census
III.
Contents of the plan of GDP estimation in the year of economic census
IV.
Coverage of GDP estimation in the year of economic census
V.
Industrial Classification of GDP estimation in the year of economic census
VI.
Classification of expenditure items of GDP estimation in the year of economic
census
VII. Data sources variation of GDP estimation in the year of economic census
VIII. Adjustment of Method of GDP Estimation in the year of economic census
IX.
Main data sources and basic method of GDP estimation in the year of economic
census
X.
Adjustment of Some Special Treatment
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I.
Significance of economic census for improving GDP
estimation in China
1.Economic census provides relatively integrated and detailed data source
(1) Be advantageous to expand the coverage of GDP estimation
(2) Be advantageous to get GDP estimation at detailed industrial level
(3) Be advantageous to improve the method of GDP estimation
2. Provide a good opportunity to make Chinese GDP estimation in line with
international standard
3
II. Purpose of formulating a plan of GDP estimation in the year of
economic census
1.
Improve the accuracy and completeness of GDP estimates through
improving the scientificalness and standardization of GDP estimation in
the year of economic census
2.
Maintain the comparability between national data and regional data, or
among regional data themselves
3.
Increase the transparency of GDP estimation in the year of economic
census to facilitate the users to understand, supervise and appropriately
use GDP estimates.
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III. Contents of the plan of GDP estimation in the year of
economic census
1. Clarify the coverage of GDP estimation in the year of economic census
2. Decide the industrial classification and expenditure item classification of
GDP estimation in the year of economic census
3. Standardize the data sources and methods of GDP estimation in the year of
economic census
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IV. Coverage of GDP estimation in the year of
economic census
1. System of China’s National Accounts, 2002 explicitly defines
that the production boundary in national accounts in China
includes three parts :
(1) Production of all goods and services produced and provided to
or intended to provide to other units by the producers
(2) Own account production of all goods either used as final
consumption or used as fixed capital formation
(3) Owner occupied dwelling services and own account household
services provided by the paid household workers
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2. Omissions of GDP estimation in regular years
Some activities are missed in China’s GDP estimation due
to the constraint of data sources.
(1) The activities of establishments which are different from the main
activity of the corporation or other legal entities
(2) Dwelling services rented by households
(3) Household services provided by the paid nannies
(4) Tutor services
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3.Expand coverage of GDP estimation
(1) Fill in gaps of GDP estimation by census data
a) The activities of establishments which are different from the main
activity of the corporation or other legal entities
(2) Fill in gaps of GDP estimation by the data from household survey
a) Dwelling services rented by households
b) Household services provided by the paid nannies
c) Tutor services
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V.
Industrial Classification of GDP estimation in the year of
economic census
1. Further Partition of Industrial Classification
(1) Change of the total number of industries
In the previous years: 26 industries
In the year of economic census: 95 industries
(2) Specific description of the further partition
a) Mining and quarrying is further partitioned into 6 industries, including
Mining and washing of coal, Extraction of petroleum and natural gas etc.
b) Manufacturing is further partitioned into 30 industries, including
manufacture of Agricultural Products , manufacture of food products etc.
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c)Production and supply of electricity, gas and water is further
partitioned into 3 industries, including Production and supply of
electric power and heat power etc.
d) Construction is further partitioned into 4 industries, including
Construction of building and civil engineering etc.
e) Transportation and Storage is further partitioned into Railway
transportation, Road transportation, Air transportation etc.
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2.Adjust of industrial classification
(1) Harvesting of Timbers and Bamboos is adjusted from Mining and
Quarrying to Forestry
(2) Primary Manufacture for Agricultural Product is adjusted from
Manufacture to Service Activities for Agriculture, Forestry,
Animal Husbandry and Fishing
(3) Service Activities for Agriculture, Forestry, Animal Husbandry and
Fishing is reclassified from the tertiary industry in the past to the
primary industry in the new classification
(4) Geological Prospecting and Water Conservancy is partitioned into
two industries: Geological Prospecting , Water Conservancy.
Geological Prospecting is adjusted as sub-industry of
Scientific Research, Technical Services and Geological Prospecting;
Water Conservancy is adjusted as sub-industry of Water
Conservancy, Environment and Management of Public Equipment.
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(5)Telecommunication is adjusted from Post and Telecommunication to
Telecommunication and Other Information Transmission Service.
(6) Restaurants is adjusted from sub-industry of Wholesale and Retail Trade,
Restaurant as sub-industry of Hotels and Restaurants
(7) Urban Public Transportation /Household Services/ Hotels / Computer
Application Services/ Renting are treated as Social Services in the old
classification and adjusted to Transportation,Storage and Post/
Household Services and Other Services /Hotels and Restaurants
/Information Transmission, Computer Hardware and Software
Services /Renting and Business Services respectively.
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VI. Classification of expenditure items of GDP estimation in the
year of economic census
1.The same expenditure items of GDP estimation in either economic census year
or non-economic census years
Final consumption Expenditure
Household Consumption Expenditure
Rural Household Consumption Expenditure
Urban Household Consumption Expenditure
Government Consumption Expenditure
Gross Capital Formation
Gross Fixed Capital Formation
Changes in Inventories
Net Export of Goods and Services
Export of Goods and Services
Import of Goods and Services
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2. The different expenditure items of GDP estimation in the year of economic
census comparing to those in non-economic census years
(1) Rural Household Consumption Expenditure
a) Items in the year of economic census
Consumption of Foods
Consumption of Clothes
Consumption of Dwellings Services
Consumption of Family Appliances and Services
Consumption of Health Care Services
Consumption of Free Medical Care Services
Consumption of Transport and Telecom Services
Consumption of Appliance and Services of Education, Culture and Recreation
Consumption of Financial Intermediation Services and Insurance Services
Consumption of Owner-occupied Dwelling Services
Consumption of Other Goods and Services
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b) Items in the non-economic census years
Consumption of Traded Consumer Goods
Consumption of Own Account Consumer Goods
Consumption of Culture and Recreation Services
Consumption of Housing, Water, Electricity and Gas
Consumption of Owner-occupied Dwelling Services
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(2) Urban Household Consumption Expenditure
a) Items in the year of economic census
Consumption of Foods
Consumption of Clothes
Consumption of Dwelling Services
Consumption of Family Appliances and Services
Consumption of Health Care Services
Consumption of Free Medical Care Services
Consumption of Transport and Telecom Services
Consumption of Appliances and Services of Education, Culture and
Recreation
Consumption of Financial Intermediation Services and Insurance Services
Consumption of Owner-occupied Dwelling Services
Consumption of Income in Kind
Consumption of Other Goods and Services
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b)Items in the previous year
Consumption of Traded Consumer Goods
Consumption of Income in Kind
Consumption of Culture and Recreation Services
Consumption of Housing, Water, Electricity and Gas
Consumption of Owner-occupied Dwelling Services
Consumption of Free Medical Care Services
Consumption of Collective Welfare Services
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(3) Export of Goods and Services
In previous years, Export and Import of Goods and Services have no
detailed breakdowns. In the year of economic census, Export and Import of
Goods and Services are further partitioned into:
Export (import) of Goods and Services
Export (import) of Goods
Export of General Goods
Export of Processing Goods
Export of Other Goods
Export (import) of Services
Export of Transportation Services
Export of Tourism Services
Export of Communication Services
Export of Construction Services
Export of Insurance Services
Export of Computer and Information Services
Export of Other Services
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VII. Data sources variation of GDP estimation in the year of
economic census
(1) The Financial statements data of the following types of corporation
or other legal entities are not available in the regular statistics:
Construction enterprises under the qualified level
Wholesale and Retail Trade enterprise under the cut-off level
Hotels and Restaurants enterprises under the cut-off level
Computer Services and Software enterprises
Renting and Business Services enterprises
The economic census provided relatively detailed financial statements data
on the above various types of corporations or other legal entities
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(2) Financial statements indicators for industrial enterprises under
cut-off level in the sample survey questionnaires in regular statistics
are different from those in the economic census
(3) Data on the performance of individual business operators in
various industries are very limited in regular statistics. Questionnaire
on Operating Status of Individual Business Operators, are designed in
the economic census
(4) Data on the establishments whose activities are different from the
main activity of the corporation or other legal entities are very limited
in regular statistics. Therefore, Questionnaire on Basic Information of
Establishments is designed in the economic census to provide data on
value-added estimation of the establishments
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VIII. Adjustment of Method of GDP Estimation in the Year of
Economic Census
1. Corporations or other legal entities whose financial statements are not
available in the regular statistics
(1) In previous years, value-added derived mainly indirectly by using
the relevant indicators in the regular statistics
(2) In the year of economic census, value-added derived mainly
directly by using financial statements data
2. Industrial enterprises under cut-off level
(1) In previous years, estimation method is based on financial
indicators from the sample survey
(2) In the year of economic census, estimation method is based on
financial indicators in Questionnaire of Situations of Production
and Operation of Industrial Enterprise under cut-off level
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3. Individual business operators
(1) In previous years, estimation method is based on available
indicators in regular statistics
(2) In the year of economic census, estimation method is based on
indicators in Questionnaire on Operating Status of Individual Business
Operators
4. Establishments whose activities are different from the main activity
of the corporation or other legal entity
(1) In previous years, no clearly defined method due to data limitation,
(2) In the year of economic census, estimation method is based on
Questionnaire of Basic Information of Establishment
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IX. Main data sources and basic method of GDP estimation
in the year of economic census
1. Basic method of GDP estimation in the year of economic census
Three approaches are used to estimate GDP, which are production
approach, income approach, and expenditure approach.
GDP by production approach = Σvalue-added by production approach
= Σ(output – intermediate input)
GDP by income approach = Σvalue-added by income approach
= Σ(compensation of employees + net production taxes + depreciation
+ operating surplus)
GDP by expenditure approach = Final consumption expenditure
+ Gross capital formation+ net export of goods and services
= (Household consumption expenditure + Government consumption
expenditure)+(Gross fixed capital formation + Changes in
Inventories)+(Export of goods and services – Import of goods and
services)
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2.Main data sources of production-oriented GDP estimation in the year of
economic census
(1) Industry
a) Questionnaire of Situations of Production of Industrial Enterprise above
cut off level
b) Questionnaire of Financial Situation of Industrial
Enterprise above cut off level
c) Questionnaire of Situations of Production and Operation of Industrial
Enterprise below cut off level
d) Questionnaire of Basic information of Establishment
e) Questionnaire on Operating Status of Individual Business Operators
(2) Construction
a) Questionnaire of Situations of Production of General Contractor and
Professional Contractor (Special Trade) of Construction Enterprise
b) Questionnaire of Financial Situation of General Contractor and
Professional Contractor (Special Trade) of Construction Enterprise
c) Questionnaire of Situations of Production and Operation of
Subcontractor and Construction Enterprises with
Non-qualification Criteria
d) Questionnaire of Basic information of Establishment
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e) Questionnaire on Operating Status of Individual Business Operators
(3) Transportation, Storage and Post
a) Questionnaire of Financial Situation of Transport, Post and
Telecommunication Enterprise
b) Questionnaire of Profit and Loss Statement of Railway Transportation
Enterprise
c) Questionnaire of Statement of Total Expenditure of Railway
Transportation Enterprise
d) Questionnaire of Financial Situation of National Post Agency
e) Questionnaire of Financial Situation of Service Enterprise
f) Questionnaire of Financial Situation of Administrative and Institutional
Unit
g) Questionnaire of Basic Information of Establishment
h) Questionnaire on Operating Status of Individual Business Operators
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3. Changes in data sources and method of GDP by expenditure approach
(1) Household Consumption Expenditure
a) The population used for calculating Rural Household Consumption
Expenditure and Urban Household Consumption Expenditure are data
from the census, which are counted by current residence, rather than
those used in the non-census years, which are counted by the registered
permanent residence.
b) In non-census years, Consumption of Traded Consumer Goods is
calculated based on the indicator of Retails of Commodities, whereas
in census years, it is based on the household consumption expenditure
data from the Rural Household Survey and the Urban Household Survey
(2) Government Consumption Expenditure
a) In non-census years, Government Consumption Expenditure
is estimated mainly based on government financial statements data
b) In the year of economic census, it is estimated mainly using
relevant data from the economic census
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(3) Gross Fixed Capital Formation
Adjusted treatment of software expenditure
(4) Changes in Inventories
a) In the previous years, changes in Inventories is mainly
estimated according to various statistics and financial
statements
b) In census year, it is mainly estimated by census data
(5) Import and Export of Goods and Services
a) In the previous years, Import and Export of Goods and
Services have no detailed breakdowns.
b) In the year of economic census, Import and Export of Goods
and Services are estimated based on the detailed data of the
Balance of Payment.
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X.
Adjustment of Some Special Treatment
1 Adjustment of the treatment of financial intermediation services
(1) In the previous years, net interest accrued of each industry is treated
as intermediate input
(2) In census year, the output of financial intermediation services is
allocated across industries and final users
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2. Adjustment of the treatment of taxes on imported goods
(1) Taxes on imported goods are added to the value-added of
Wholesale and Retail Trade industry
(2) The taxes on imported goods are to be concluded in the GDP by
production approach and by income approach as a whole
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3. Adjustment of the Treatment of Computer Software
(1) Whether the acquisition of computer software is treated as fixed
capital formation or as intermediate input is not clearly defined in
current practice
(2) In the year of economic census, the treatment will change to be
consistent with that recommended in the 1993 SNA according to the
census data as much as possible
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4. Adjustment of the depreciation ratio used in the imputed calculation
of households owner-occupied dwellings services
(1) In current practice, the depreciation ratio used in the imputed
calculation of owner-occupied dwellings services of rural
households is 2%, while for urban households is 4%
(2) These two ratios will be adjusted to be consistent in the year of
economic census
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