1. Carsten Olsson Eurostat
2 July 2003
Harmonized Index of Consumer Prices Price Statistics in the European Union National and Local Dimensions
Carsten Olsson
Eurostat
Assemblea straordinaria USCI, July 2003

2. HICP Content Why is it needed? What is it?
2 July 2003
HICP Content
Why is it needed?
What is it?
What are the roles and responsibilities at
international level,
national level, and
local level
Assemblea straordinaria USCI, July 2003

3. HICP Why is it needed Required by EU Treaty (Maastricht Treaty)
2 July 2003
HICP Why is it needed
Required by EU Treaty (Maastricht Treaty)
Used by ECB for their monetary policy
Different purpose than national CPIs
… but still use the same price observations for most expenditure groups
Assemblea straordinaria USCI, July 2003

4. HICP What is it? Development started 1993; Series start Jan-96
2 July 2003
HICP What is it?
Development started 1993; Series start Jan-96
Methodology based on BEST practices
CPI experts
15 Member States, and
3 EEA countries, 10 Candidate Countries
Using national experiences
Designed for International Comparison
Produce COMPARABLE Price Indices
Assemblea straordinaria USCI, July 2003

5. HICP - International Dimension Best Practices
2 July 2003
HICP - International Dimension Best Practices
Several Council and Commission Regulations
Population and Geographical Coverage
Expenditure coverage (HFMCE)
EA formulae
Quality Adjustment
Sampling of outlets and products
Assemblea straordinaria USCI, July 2003

6. HICP - International Dimension Best Practices (continued)
2 July 2003
HICP - International Dimension Best Practices (continued)
Sales prices
Timing
Health, Education, and Social Protection
Assemblea straordinaria USCI, July 2003

7. An example of improved comparability (1)
2 July 2003
An example of improved comparability (1)
Assemblea straordinaria USCI, July 2003

8. An example of improved comparability (2)
2 July 2003
An example of improved comparability (2)
Assemblea straordinaria USCI, July 2003

9. HICP - International Dimension Best Practices (continued)
2 July 2003
HICP - International Dimension Best Practices (continued)
Not covered yet
Treatment of Seasonal Items
Price collection period
Clarifications for Quality Adjustment and Sampling
Owner Occupied Housing
Assemblea straordinaria USCI, July 2003

10. HICP - International Dimension
2 July 2003
HICP - International Dimension
Eurostat and Member States (=National Statistical Institutes)
Developing methodology for the HICP through discussions
Several meeting every year
Defining rules (=Regulations)
Quality Control
Eurostat : compiling euro-zone HICP
Assemblea straordinaria USCI, July 2003

11. HICP - National Dimension
2 July 2003
HICP - National Dimension
ISTAT
Responsible for implementation of Regulations covering the HICP
Responsible for compilation and transmission of national HICP to Eurostat
Responsible for Quality Control
Responsible for further input to the EU harmonization process
Assemblea straordinaria USCI, July 2003

12. HICP - Local dimension Municipalities in Italy
2 July 2003
HICP - Local dimension Municipalities in Italy
Responsibilities, for example
Outlet selection
Price collection
Quality control
Training of price collectors
Selection of representative products
(Compilation of local indices)
Responsible towards and together with ISTAT
Assemblea straordinaria USCI, July 2003

13. HICP - Local dimension Municipalities in Italy
2 July 2003
HICP - Local dimension Municipalities in Italy
But also responsible for
Implementation of HICP Regulations as far as changes are required at local level
Assemblea straordinaria USCI, July 2003

14. HICP - Local Dimension Specific Italian Issues
2 July 2003
HICP - Local Dimension Specific Italian Issues
Sales prices (solved)
Frequency of price collection, quality adjustment and imputation of past prices
Assemblea straordinaria USCI, July 2003

15. HICP - Local Dimension Specific Italian Issues
2 July 2003
HICP - Local Dimension Specific Italian Issues
Price collection period
Representative of the month
Streamline production process
Eurostat still needs provisional index from main municipalities at end of month
Assemblea straordinaria USCI, July 2003

16. HICP Conclusion Need good co-operation Quality Control at all levels
2 July 2003
HICP Conclusion
Need good co-operation
Eurostat  ISTAT
ISTAT  Municipalities
Quality Control at all levels
For example in price collection, selection of outlets, products, etc.
Training
Learn from each other
Assemblea straordinaria USCI, July 2003

17. HICP Conclusion Implementation of HICP Regulations Aim is always
2 July 2003
HICP Conclusion
Implementation of HICP Regulations
Aim is always
Best methodology
Greater comparability
Your work is required but also appreciated
Assemblea straordinaria USCI, July 2003