MEASURING GDP IN THE BALKANS EXPERIENCES AND LESSONS LEARNED OECD-NBS Workshop on National Accounts September 25-28, 2007, Beijing Contact:

GDP Exhaustiveness in the Balkans Two phase project –Phase I: , funded by Eurostat –Phase II o7, funded by EFTA Objective: –To improve ‘exhaustiveness’ of GDP

Phase I Objectives Focus on Output based approaches –Special focus on imputed-rent OECD handbook describes the NOE using themes. The framework used for this report was the Eurostat Tabular Approach

The Production Boundary – A reminder

Eurostat’s Tabular Approach

Tabular Approach –Provides scope for good international comparability –But care still needed in interpretation –e.g. since 2006 self employed are included in the BR, prior to that they were in an AR and so N5. –And so focus of comparability should not be on total N1 to N7.

Tabular Approach –Provides scope for good international comparability –But care still needed in interpretation –e.g. since 2006 self employed are included in the BR, prior to that they were in an AR and so N5. –And so focus of comparability should not be on total N1 to N7. –N1+N6 not really affected by changes in statistical system and strongly related to underground, evasive, production,

Tabular Approach –For international comparability important also to compare by sector – agriculture, the public sector, utilities, imputed rent are all special case sector and so removing them from the numerator may improve international comparisons. –Certainly this approach helps to illustrate to commentators the comprehensive and large nature of adjustments in some countries.

Tabular Approach

Labour Input Approach Key to the improvement in most countries has been the implementation of ‘labour input’ measures. Robust measures but care needed, particularly when sectoral estimates are required.

Labour Input Approach

Illegal Activities Narcotics Prostitution People Smuggling Copyright Infringement Corruption?

Imputed Rent – user cost approach

Imputed Rent- estimating the stock of dwellings at current market prices when PIM cannot be applied

Imputed rent - issues Valuations of buildings that are older than the expected service life (and, more generally, the ability to estimate investment (improvements) made to dwellings to prolong service lives when the only data available is Census information). Valuations of land across regions and urban/rural splits, new/old dwellings and especially over time and real estate markets that show significant price growth, since in practice it is the land, through scarcity, that reflects the value increase. Methods used to estimate the different attributes (m2, fitted kitchens, number of toilets, double glazing etc). Erratic Intermediate consumption estimates over time