Good Morning ********************** Welcome to ESTP course on National Accounts ESA 2010 Luxembourg, 15 May - 19 May 2017 Eurostat

Structure of the Course First three days on basics of national accounting Brief history of National Accounts (NA) Overview of ESA 2010 Units and Sectors Production, Expenditure, Income Stocks and Flows, BoP Last two days on specific topics: Supply/Use Tables and Balancing Employment Price and Volume Measures and Purchasing Power Parities Financial Accounts Quarterly National Accounts and European Sector Accounts FISIM Government Finance Statistics Parallel sessions on items 8, 14, 19 and 24

Item 1: Introduction to National Accounts ESTP course on National Accounts ESA 2010 Luxembourg, 15 May - 19 May 2017 Eurostat

A bit on History of NA Two main characteristics of the modern NA: consistent bookkeeping system and macroeconomic theory. Double entry bookkeeping: Luca Pacioli 1494 Tableau économique (1758) by François Quesnay: economic circuit, economic flows between sectors (landowners, farmers, artisans and merchants) John Maynard Keynes 1936: modern macroeconomics, role of government Wassily Leontief, input-output analysis (Nobel Price 1973) Richard Stone (Nobel Price 1984); flowed into UN System of National Accounts

Modell of the National Economy

The System of NA "The aim" of NA: measure value added created in one period (GDP) production  value added  income  use of income (expenditure) UN level: SNA EU level: ESA Harmonised concepts, methods, definitions, classifications and recording/bookkeeping rules

SNA and ESA UN level: SNA 1993 SNA 2008 EU level: ESA 1995 ESA 2010

Key features of the System The value added of NA: It is a complete and consistent system! Basic macroeconomic identities hold; supply = use It is a complex interlinked system Three approaches to measure GDP: Production Approach (PA), Expenditure Approach (EA) and Income Approach (IA) Different Sources and different Methods Balancing! The sequence of accounts: production, distribution of income, use of income

The three Approaches to GDP PA EA IA Output Total final cons. expend. Compens. of employees - Intermediate consumption by households + Gross operating surplus GVA (bp) by NPISH and mixed income +taxes on products by general government + taxes on production - subs. on products + gross capital formation and imports GDP (mp) GFCF - subsidies   changes in inventories GDP acqu. less dispos. Valuables + Exports - Imports

Further features of the System Satellite Accounts: for specific needs e.g. Economic Accounts for Agriculture, Environmental Accounts, Tourism, Health Care. Supply and use tables / symmetric input-output tables: details of the production process and flows of goods and services. Price and Volume Measures

The Uses of NA for economic analysis (structural analysis, business cycle analysis) for policymaking (productivity, growth, employment etc.) for monetary policy-making for financial markets, businesses for research purposes and for administrative uses

Administrative Uses of NA EU own resources purposes VAT based own resource GNI based own resource EU structural funds Surveillance purposes Excessive Deficit Procedure (EDP) Macroeconomic Imbalances