Compilation of ITGS indices: New method implemented in Denmark Anette Hertz, Head of section, Statistics Denmark

 Why interested in a new method  Looking for ways to improve the indices  A description of the new index compilation system  The old vs the new index  What is next? Agenda 2

 Lack of documentation of the old system  The system has had a sort of black box character  The accuracy of the index have been questioned by our users Why interested in a new method 3

 We wish to reduce volatility and “know” our compilation system  Index calculation on more homogenous groups will reduce volatility  Inspired by our Finnish collegues we decided to use company level data  That is we do outlier detection at PSI level as well as the index computations Looking for ways to improve the indices 4

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 All records with a value=1  CN codes in chapter 98 and 99  Industrial plants, vessels and aircrafts  CN codes with supplementary units: -Kg 90% sdt, kg/net eda, kg P2O5, kg NAOH, kg KOH, kg N, kg K2O, kg H2O2, GBq, gi F/S, ce/el, kg met.am., kg C5H1 Exemptions from the indices 6

Outlier detection 7

Chained fisher index 8

From base index to total index and chaining 9

Handling volatile indices 10

 The old index series started in 1995, the new will start in 2005  Indices at flow*CN*PSI*country instead of flow*CN*country  A separate outlier detection at micro data level  Published total indices as well as 1- and 2-digit SITC, also 3-digit SITC for certain groups as opposed to BEC and KONJ  We can exclude observations from the indices until they have been verified The old vs the new index 11

 Calculation of terms of trade  Integrate the validation of extreme outliers in the clerical workers daily tasks  New system hopefully in production from November 2014 What is next? 12

Thank you for your attention Questions?