1. Technical assistance strategies to improve expenditure estimates and price deflators
Joseph Mariasingham
Economic Research and Regional Cooperation Department
Asian Development Bank

2. Contents Principal Components Necessary for the Estimation
Item Definition and Prices Collection
Definition and Estimation of Expenditure
Targeting Areas for Improvement: Governance
Targeting Areas for Improvement: Methods and Tools
Targeting Areas for Improvement: Statistical Infrastructure
Targeting Areas for Improvement: Data
Globalization and ICP
The Baseline Strategy
The Integrated Advocacy Strategy
Summary: Towards ICP 2016 with a new Approach
Questions and Comments

3. 1. Principal Components Necessary for the Estimation
Methodology
Tools
Expenditures
Prices
Technical capacity
Financial capacity
Institutional capacity
Governmental support for the project
Governmental acceptance of the results
ICP Control
Govt.
control

4. 2. Item Definition and Price Collection
Representativity
Comparability
Confirmation bias
Overlap with CPI
Price Collection
Collection mechanism
Sampling issues
Statistical biases
Validation issues
Quality Control
Mechanism for ensuring data quality
Comparability of data quality
Treatment of data of different quality within the framework

5. 3. Definition and Estimation of Expenditures
Category Definition
Criteria for defining a category
Situating the category within the realm of an economy
Do the categories span the economy
Tradeoff between representativity and comparability
Bias due to categorization
Estimation Process
Sources and methods
Errors, omissions and gaps
Coherence analysis and auditing
Issues due to modeled estimates
Quality Control
Mechanism for ensuring data quality
Comparability of data quality
Treatment of data of different quality within the framework

6. 4. Target Area for Improvement: Governance
Process Control
Clear definition of the administrative roles and responsibilities of the WB ICP team, RC and NIAs
Modalities for administrative control and coordination
Establishing global, regional and country implementation plans
Synchronizing global, regional and country implementation plans
Tracking the progress and taking corrective actions
Greater role for NIAs at the global and regional governance level

7. 4. Target Area for Improvement: Governance
Quality Control
Establish a quality assurance framework
Monitor the compliance with the framework systematically at the global, regional and country levels
Primarily ensuring quality at the country level
Primary responsibility should rest with the NIAs
Roles, responsibilities and engagement of the experts need to be defined clearly; their role is supportive not supervisory

8. 4. Target Area for Improvement: Governance
Resource Control
Resources are to be used efficiently and effectively
Workshops, consultants and travel consume most of the budget
Most of the resources should directed and targeted towards high quality data development at the country level
ICT as the primary means for meetings, instead of physical travel

9. 5. Target Area for Improvement: Methods and Tools
Concepts, Methods, Methodologies and Techniques
Comprehensive and timely review
Test of accuracy and relevance
Test of universal applicability
Software and IT Estimation and Assessment Tools
Tool diagnostic test and complete review of the codes
No black boxes
When a serious question is raised about data quality everything that contributed to the production of the data is subject to review

10. 6. Target Area for Improvement: Statistical Infrastructure
Importance of an effective statistical system
Characteristics of an effective statistical system
Data quality is directly proportional to the strength of the system
Statistics derived from primary data versus modeled estimates

11. 6. Target Area for Improvement: Statistical Infrastructure
Identifying critical gaps in a statistical system
Bridging the gaps through targeted assistance
Enabling the system to sustain capacity and evolve through advocacy
An effective system is the only long term and sustainable solution
Global convergence in effectiveness assist in nationally institutionalizing ICP
A global strategy with the national institutions as major stakeholders

12. 6. Target Area for Improvement: Statistical Infrastructure
Step One: institutionalization of ICP by the sponsoring multilaterals
Step Two: Established funding mechanisms and annual budgets
Step Three: Country specific engagement
Step Four: Institutionalizing at the national level
Step Five: Targeted assistance with clear timelines and expiry dates

13. 7. Target Area for Improvement: Data
Prices
Accuracy and relevance of the data collected
Representativeness of the statistics
Expenditures
Coherence of the estimates

14. 7. Target Area for Improvement: Data
Supply and Use Tables
Framework for studying expenditures and prices
Tables in current prices
Tables in constant prices
Feedback mechanism to the statistical system
Key economic indicators
Tangible and clear outcomes for advocacy purposes
An effective strategy adopted by ADB to improve economic statistics

15. 7. Target Area for Improvement: Data
International Supply and Use Tables
Uniformity in standards across the globe
A more rigorous framework for coherence analysis

16. 8. Globalization and ICP
The role of ICP in a globalized economic environment
Research on globalization and ICP products and by products
Collaboration between researchers on globalization and PPPs
PPPs as indicators of globalization
Time-series of PPPs
The necessity for an effective statistical system

17. 9. The Baseline Strategy
PPPs as the by-products of an effective statistical system
Quality estimates through rigorous coherence analysis
Strategic technical assistance for sustainable capacity
Integrate the ICP processes into the assembly line of the NSOs
ICP as an internationally and nationally institutionalized program
Efficiency and effectiveness at all administrative levels
Judicious use of resources
Accountability mechanism
Engage policy makers
Demonstrate the utility of ICP products
Promote the use of ICP products
Adopt a business like (not academic like) approach to the program

18. 10. Integrated Advocacy Strategy
The country is the most important stakeholder and client
Strategies and plans should be country-centric
Interest in the ICP evolves from the broader realization of criticality of good statistics
Engage decision makers and policy makers
Engage NSOs at the managerial level
Engage the NSOs at the technical staff level
Connect potential users with the NSOs
Make ICP more than just about PPPs
Gradually transfer of responsibilities, controls and ownership to the NSOs
The longer and the more the core responsibilities and controls are with the multilaterals the more the program will be seen as intermittent: from one cycle to another

19. 11. Summary: Towards ICP 2016 with a new Approach
One-team approach at the global level
Formal agreement between international organizations to share knowledge, products and credits
Effective and efficient governance and administration at all levels
Greater engagement of the NSOs, policy makers and decision makers
Technical assistance to construct Supply and Use Tables
Technical assistance to integrate ICP price collection into the regular business of the NSOs
ICT for ICP
Institutionalization of ICP at the national and international levels

20. 12. Questions and Comments
ICP Team at ADB
Rana Hasan
Director
Development Economics and Indicators Division
Tel: +(632)
Joseph Mariasingham
Statistician and Project Officer
Development Economics and Indicator Division
Tel: +(632)
Eileen Capilit
Economics and Statistics Officer
Tel: +(632)