ESTIMATION OF THE HOUSEHOLD
SECTOR
(Philippine Case)
Presented by
Raymundo J. Talento
Director, Economic Statistics Office
National Statistical Coordination Board
International Workshop on household Income, Consumption and Full
Accounting of the Household Sector
Beijing, China 26-28 March 2012
International Workshop on Household Income, Consumption & Full Accounting of the
Household Sector , Beijing, China NATIONAL STATISTICAL COORDINATION
RJ Talento /26-28 March 2012 BOARD
Outline of the Prensentation
I. Introduction
II. Scope and Coverage
III. Data Sources
IV. Estimation Methodology
V. Issues/concerns
International Workshop on Household Income, Consumption & Full Accounting of the
Household Sector , Beijing, China NATIONAL STATISTICAL COORDINATION
2 BOARD
RJ Talento /26-28 March 2012
I. Introduction
Measurement of GDP
Three approaches in GDP Measurement
1.Production Approach, GDP (P)
2. Expenditure Approach, GDP (E)
3. Income Approach, GDP (I)
International Workshop on Household Income, Consumption & Full Accounting of the
Household Sector , Beijing, China NATIONAL STATISTICAL COORDINATION
3 BOARD
RJ Talento /26-28 March 2012
I. Introduction
Measurement of GDP cont’n…
1. Production Approach, GDP (P)
Unduplicated sum of all the goods and
services produced in the domestic economy (by
resident producers)
Measurement of GDP by industrial origin
Formula: GDP (P) = GVA
where:
GVA = Gross Value Added
= Gross Output Less Intermediate
Inputs
International Workshop on Household Income, Consumption & Full Accounting of the
Household Sector , Beijing, China NATIONAL STATISTICAL COORDINATION
4 BOARD
RJ Talento /26-28 March 2012
I. Introduction
Measurement of GDP cont’n…
2. Expenditure Approach, GDP (E)
Sum of the final uses of goods and services (all
except intermediate consumption) measured at
purchaser’s prices, less the value of imports of
goods and services
Formula: GDP (E) = HFCE + GFCE+ GDCF + X – M
where:
HFCE = Household Final Consumption
Expenditure
GFCE = Government Final Consumption
Expenditure
GDCF = Gross Domestic Capital Formation
X = Exports
International Workshop on HouseholdM = Imports
Income, Consumption & Full Accounting of the
Household Sector , Beijing, China NATIONAL STATISTICAL COORDINATION
5 BOARD
RJ Talento /26-28 March 2012
I. Introduction
Measurement of GDP cont’n…
3. Income Approach, GDP (I)
Sum of primary incomes distributed by
resident producer units
Formula: GDP (I) = CE + D + T – S + OS
where:
CE = Compensation of Employees
D = Depreciation
T = Taxes (products/production)
S = Subsidies
OS = Operating Surplus
International Workshop on Household Income, Consumption & Full Accounting of the
Household Sector , Beijing, China NATIONAL STATISTICAL COORDINATION
6 BOARD
RJ Talento /26-28 March 2012
I. Introduction
Measurement of GDP cont’n…
3. Income Approach, GDP (I)
By institutional units. In the present PSNA these are
:
Non-Financial
Financial
Government; and
Households and unincorporated enterprises, including
non-profit institutions serving households
Also the Rest of the World (ROW) – viewed as the
grouping of all non-resident units.
International Workshop on Household Income, Consumption & Full Accounting of the
Household Sector , Beijing, China NATIONAL STATISTICAL COORDINATION
7 BOARD
RJ Talento /26-28 March 2012
I. I. Introduction
Measurement of GNI (GNP)
Gross National Income (GNI)
Covers (Income from) Production
within the domestic territory (GDP),
including production from the rest of the
world (NFIA) provided by residents of the
Philippines
Formula: GNP = GDP + NPIA
where:
GDP = Gross Domestic Product
NPIA = Net Primary Income From
Abroad
International Workshop on Household Income, Consumption & Full Accounting of the
Household Sector , Beijing, China NATIONAL STATISTICAL COORDINATION
8 BOARD
RJ Talento /26-28 March 2012
I. Introduction
THUS,
THE PSNA GENERATES
PRODUCTION, EXPENDITURES AND INCOME
ESTIMATES
International Workshop on Household Income, Consumption & Full Accounting of the
Household Sector , Beijing, China NATIONAL STATISTICAL COORDINATION
9 BOARD
RJ Talento /26-28 March 2012
II. Scope and Coverage
HFCE consists of actual and imputed
expenditures of households for the purpose of
acquiring individual consumption of goods &
services.
Includes:
- Individual and institutional households (HHs)
- Non-profit institutions serving households
(NPISH):
International Workshop on Household Income, Consumption & Full Accounting of the
Household Sector , Beijing, China NATIONAL STATISTICAL COORDINATION
10 BOARD
RJ Talento /26-28 March 2012
II. Scope and Coverage
HFCE – classified according to purpose
- based on the Classification of
Individual Consumption according to Purpose
(COICOP) as recommended by the 2008 SNA
International Workshop on Household Income, Consumption & Full Accounting of the
Household Sector , Beijing, China NATIONAL STATISTICAL COORDINATION
11 BOARD
RJ Talento /26-28 March 2012
II. Scope and Coverage
HFCE – includes:
1. Food and Non-alcoholic Beverages
2. Alcoholic Beverages and Tobacco
3. Clothing and Footwear
4. Housing, Water, Electricity, Gas and Other Fuels
5. Furnishings, Household Equipment and Routine
Household Maintenance
6. Health
7. Transport
8. Communication
9. Recreation and Culture
10. Education
11. Restaurants and Hotels
12. Miscellaneous Goods and Services
International Workshop on Household Income, Consumption & Full Accounting of the
Household Sector , Beijing, China NATIONAL STATISTICAL COORDINATION
12 BOARD
RJ Talento /26-28 March 2012
III. Data Sources
Data/information used :
- Family Income and Expenditures Survey (FIES)
of NSO
- Consumer Price Index (CPI) of NSO
- 2000 Input-Output (I-O) Table of NSCB
- Total output of industry sectors from the
estimates of the National Accounts of the NSCB
- Foreign Trade Statistics (FTS) of NSO
- Administrative-based data of various agencies
(i.e. volume & value of removals for cigars,
cigarettes & alcoholic drinks from the BIR)
International Workshop on Household Income, Consumption & Full Accounting of the
Household Sector , Beijing, China NATIONAL STATISTICAL COORDINATION
13 BOARD
RJ Talento /26-28 March 2012
IV. Methodology
2000 Benchmark Year
- adopted as initial estimate the 2000 I-O
estimates of HFCE, with each HFCE I-O
code/description classified according to
COICOP.
International Workshop on Household Income, Consumption & Full Accounting of the
Household Sector , Beijing, China NATIONAL STATISTICAL COORDINATION
14 BOARD
RJ Talento /26-28 March 2012
IV. Methodology
Non-benchmark Year (1998-1999, 2001-2010)
- the 2000 benchmark estimate of HFCE by
sub-component was extrapolated using the
trend of the gross output of related industry
sector
- estimates are reconciled with the other
sectors through the supply and use table
- it is further validated using the expenditure
structure derived from the FIES.
International Workshop on Household Income, Consumption & Full Accounting of the
Household Sector , Beijing, China NATIONAL STATISTICAL COORDINATION
15 BOARD
RJ Talento /26-28 March 2012
V. Issues & Concerns
SHOULD THE INCOME AND EXPENDITURES
DATA OF THE PSNA AND THE FIES
BE
“CONSISTENT”?
“RECONCILED”?
International Workshop on Household Income, Consumption & Full Accounting of the
Household Sector , Beijing, China NATIONAL STATISTICAL COORDINATION
16 BOARD
RJ Talento /26-28 March 2012
V. Issues & Concerns
What is the FIES?
is a household survey being conducted by the
NSO every three years
Provides data on family income and
expenditures which include among others levels
of consumption by item of expenditure as well
sources of income in cash and in kind
Source of weights for the CPI
Used for computing poverty incidence
Used for analyzing income distribution
Used as an indicator for NA purposes
International Workshop on Household Income, Consumption & Full Accounting of the
Household Sector , Beijing, China NATIONAL STATISTICAL COORDINATION
17 BOARD
RJ Talento /26-28 March 2012
V. Issues & Concerns
The FIES does not collect
income/expenditures data from
Non-Financial Institution
Financial Institution
Government
Non-profit institutions serving
households
Rest of the World (ROW)
International Workshop on Household Income, Consumption & Full Accounting of the
Household Sector , Beijing, China NATIONAL STATISTICAL COORDINATION
18 BOARD
RJ Talento /26-28 March 2012
V. Issues & Concerns
In the PSNA, the Transactors (Institutional
Sectors) of the Economy are:
Non-Financial Institution
Financial Institution
Government; and
Households and unincorporated
enterprises, including non-profit
institutions serving households
Also Rest of the World (ROW) – the
grouping of all non-resident units.
International Workshop on Household Income, Consumption & Full Accounting of the
Household Sector , Beijing, China NATIONAL STATISTICAL COORDINATION
19 BOARD
RJ Talento /26-28 March 2012
V. Issues & Concerns
Therefore, if one must “compare” income
data from the PSNA and the FIES, the
closest one may look for comparability is
THE HOUSEHOLD SECTOR!
International Workshop on Household Income, Consumption & Full Accounting of the
Household Sector , Beijing, China NATIONAL STATISTICAL COORDINATION
20 BOARD
RJ Talento /26-28 March 2012
V. Issues & Concerns
IS
FIES INCOME = PSNA INCOME OF THE
HOUSEHOLD SECTOR?
International Workshop on Household Income, Consumption & Full Accounting of the
Household Sector , Beijing, China NATIONAL STATISTICAL COORDINATION
21 BOARD
RJ Talento /26-28 March 2012
V. Issues & Concerns
FIES INCOME REFERS TO INCOME IN CASH
AND IN KIND RECEIVED BY THE HH’s
FIES INCOME INCLUDES (FIES
QUESTIONNAIRE):
PART III: INCOME AND OTHER RECEIPTS
PART IV: ENTREPRENEURIAL ACTIVITIES
PART II: EXPENDITURE AND OTHER
DISBURSEMENTS ( RECEIVED AS GIFTS)
International Workshop on Household Income, Consumption & Full Accounting of the
Household Sector , Beijing, China NATIONAL STATISTICAL COORDINATION
22 BOARD
RJ Talento /26-28 March 2012
V. Issues & Concerns
FIES INCOME INCLUDES:
Salaries and wages from employment
Net share of crops, fruits and vegetables
produced or livestock and poultry raised by
other households
Cash receipts, gifts, support, relief and other
forms of assistance from abroad
Cash receipts, support, assistance and relief
from domestic source
Rentals received from non-agricultural lands,
buildings, spaces and other properties
Interest
International Workshop on Household Income, Consumption & Full Accounting of the
Household Sector , Beijing, China NATIONAL STATISTICAL COORDINATION
23 BOARD
RJ Talento /26-28 March 2012
V. Issues & Concerns
FIES INCOME INCLUDES cont’n:
Pension and retirement, workmen’s
compensation and social security benefits
Dividends from investment
Other sources of income not elsewhere
classified
Family Sustenance Activities
Total Income from Entrepreneurial Activities
Goods and Services Received as gift
Imputed Rental Value of Owner-Occupied
Dwelling Units
International Workshop on Household Income, Consumption & Full Accounting of the
Household Sector , Beijing, China NATIONAL STATISTICAL COORDINATION
24 BOARD
RJ Talento /26-28 March 2012
V. Issues & Concerns
PSNA HH INCOME ALSO BASICALLY
REFERS TO INCOME IN CASH AND IN KIND
RECEIVED BY THE HOUSEHOLD SECTOR
PSNA HH INCOME =
COMPENSATION +
OPERATING SURPLUS +
PROPERTY INCOME +
TRANSFERS
International Workshop on Household Income, Consumption & Full Accounting of the
Household Sector , Beijing, China NATIONAL STATISTICAL COORDINATION
25 BOARD
RJ Talento /26-28 March 2012
V. Issues & Concerns
SOURCES OF DIFFERENCES
1. COVERAGE
2. CONCEPTUAL/DEFINITION OF INCOME
3. METHODOLOGICAL ( NOS OF HHS)
4. DATA-RELATED
International Workshop on Household Income, Consumption & Full Accounting of the
Household Sector , Beijing, China NATIONAL STATISTICAL COORDINATION
26 BOARD
RJ Talento /26-28 March 2012
V. Issues & Concerns
Differences between the national accounts of
the NSCB and the income data from the FIES
of the NSO.
In terms of COVERAGE:
PSNA FIES
Household & Unincorporated Enterprises Household & Unincorporated Enterprises
Individual Households Individual Households
Institutional Households
Non-profit Institution Serving Household
International Workshop on Household Income, Consumption & Full Accounting of the
Household Sector , Beijing, China NATIONAL STATISTICAL COORDINATION
27 BOARD
RJ Talento /26-28 March 2012
V. Issues & Concerns
Differences between the national income
accounts of the NSCB and the income data
from the FIES of the NSO.
In terms of TYPE OF INCOME covered:
NA
covers income of household derived from
engaging in unincorporated enterprises,
compensation of employee, property income
from investments of assets, depreciation from
the use of assets, transfers, taxes, subsidies
International Workshop on Household Income, Consumption & Full Accounting of the
Household Sector , Beijing, China NATIONAL STATISTICAL COORDINATION
28 BOARD
RJ Talento /26-28 March 2012
V. Issues & Concerns
Differences between the national income
accounts of the NSCB and the income data
from the FIES of the NSO.
In terms of TYPE OF INCOME covered:
FIES
Includes income defined in the NIA but
excludes items on depreciation and indirect
taxes or subsidies
International Workshop on Household Income, Consumption & Full Accounting of the
Household Sector , Beijing, China NATIONAL STATISTICAL COORDINATION
29 BOARD
RJ Talento /26-28 March 2012
V. Issues & Concerns
Differences between the national income
accounts of the NSCB and the income data
from the FIES of the NSO.
In terms of METHODOLOGY :
PSNA
Net Operating Surplus of Households is
residually calculated
FIES
Total Income from Entrepreneurial Activities
International Workshop on Household Income, Consumption & Full Accounting of the
Household Sector , Beijing, China NATIONAL STATISTICAL COORDINATION
30 BOARD
RJ Talento /26-28 March 2012
V. Issues & Concerns
Differences between the national income
accounts of the NSCB and the income data
from the FIES of the NSO.
In terms of DATA-RELATED DIFFERENCES :
FIES
HH response based on recall
-underreporting/overreporting of
income/expenditures
PSNA
Data comes from different sources and
estimates are validated through the SUT
International Workshop on Household Income, Consumption & Full Accounting of the
Household Sector , Beijing, China NATIONAL STATISTICAL COORDINATION
31 BOARD
RJ Talento /26-28 March 2012
Thank You!
www.nscb.gov.ph
info@nscb.gov.ph
International Workshop on Household Income, Consumption & Full Accounting of the
Household Sector , Beijing, China NATIONAL STATISTICAL COORDINATION
32 BOARD
RJ Talento /26-28 March 2012
