Measuring U.S. GDP within the
Input-Output Framework
Comments on “Interrelationship Between China’s
Input-Output Estimation: Production-based
GDP and Expenditure-based GDP”
Brian C. Moyer
13 th OECD-NBS Workshop on National Accounts
Haikou, China
November 30 – December 4, 2009 www.bea.gov

• Benchmark I-O Accounts
• Prepared every five years
• 400 industries/commodities
• Annual I-O Accounts
• 12 months after close of year
• 65 industries/commodities
• GDP by Industry Statistics
• 4 months after close of year
• 22 industry groups www.bea.gov
2

• Expenditure Approach
GDP = C + I + G + (X-M)
• Income Approach
GDP = Compensation + Gross operating surplus +
Taxes on production
• Production Approach
GDP = Gross output - Intermediate inputs www.bea.gov
3

• Census Bureau annual survey data
• Monthly/quarterly Census survey data
• Data from the tax authority
• Labor Dept. employment and wage data
• Administrative data
• Trade association data
• Data from other government agencies www.bea.gov
4

Mining and
Construction
Manufacturing
Trade and
Transportation
Utilities
Finance,
Insurance, and
Real Estate
Other
INDUSTRIES
Mining and
Construction
Manufacturing
Trade and
Transportation
Utilities
Finance,
Insurance, and
Real Estate
Other
Personal
Consumption
Expenditure
Private Fixed
Investment
FINAL USES
Change in
Private
Inventories
Net Exports
Government
Consumption and Investment
Total
Commodity
Output and
Value Added
Compensation
Taxes on
Production and
Imports
Gross
Operating
Surplus
Total Industry Output and
Final Uses www.bea.gov
5

[Percent changes and percentage-point contributions]
Gross domestic product
Construction
Manufacturing
Other goods-producing industries
Trade
Transportation
Finance
Health care
Other services-producing industries
Government
Addenda:
Not allocated by industry www.bea.gov
2004
3.6
0.0
0.7
0.1
0.3
0.3
0.6
0.2
1.3
0.1
0.16
2005
2.9
0.0
0.1
0.0
0.8
0.1
0.9
0.2
1.0
0.1
-0.24
-0.01
2006
2.8
-0.2
0.7
0.1
0.4
0.1
0.8
0.2
0.7
0.1
2007
2.0
-0.6
0.3
0.1
0.3
0.1
0.4
0.1
1.0
0.2
0.06
6

• Output by industry and commodity
• Intermediate purchases and final uses
• Value added by industry
• Balancing
• Quantity and price measures www.bea.gov
7

• Industry output: most recent benchmark
I-O estimates extrapolated with appropriate indicators; consistent with expenditure-based GDP indicators
• Commodity output: composition of industry output retained from benchmark I-O, except in manufacturing www.bea.gov
8

• Initial input estimates prepared in two broad steps
• Base-year inputs extrapolated with quantity change in output by industry
• Inputs “reflated” with appropriate input prices
• Initial final use estimates prepared using commodity-flow method; controlled to expenditure-based GDP categories www.bea.gov
9

• Initial estimates based on gross domestic income by industry
• Compensation and Taxes on production obtained from income-based GDP measures
• Gross operating surplus extrapolated from “combined” benchmark-year values; company-to-establishment adjustments applied www.bea.gov
10

• Based on RAS procedure—scaling of transactions
• Output i
= Inputs i
+ Value added i
• Total commodity output = Total industry output
• Total final uses = total value added = GDP
• Primarily adjustments to inputs; controls for value added by industry (Gross operating surplus) relaxed, as necessary www.bea.gov
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• Outputs and inputs deflated separately
• Primarily BLS Producer Price Indexes
• Consistency with expenditure-based GDP
• Value added quantity and price measures computed using Fisher-Ideal, doubledeflation procedure
• “Not allocated by industry” reflects differences with expenditure-based GDP www.bea.gov
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• “Feedback” between production and expenditure approaches
• Time-series consistency of benchmark
I-O accounts
• Quarterly GDP by industry www.bea.gov
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Planned Improvements
GDP by industry accounts
Annual input-output accounts
Quarterly GDP by industry
Improved consistency
Benchmark input-output accounts
Time-series consistency www.bea.gov
NIPAs
(GDP accounts)
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www.bea.gov
 Focused on consumer spending
 Annual I-O accounts: commodity flow method
 Expenditure-based GDP: Retail control method based on retail sales data
 Requires evaluating data quality and timing of alternative methods
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www.bea.gov
PCE for Shoes
(Billions of Dollars)
NIPA PCE
Superstores
All other stores
1997 2002
39
4
35
48
8
40
Annual I-O PCE 39 44
Economic Census Data
Superstores 4 2
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