1. Machinery and Equipment and PPPs Richard Dibley 3 rd Technical Advisory Group Meeting

2. 2 ….relevant extensive personal experience working on Eurostat capital goods surveys…. Introduction Since 1980s: Collection of the data for the UK surveys 2000 – 2004: Management of the EG surveys in all EU countries (in conjunction with construction) Since 2004: Responsibility for the 37 countries participating in the Eurostat programme 2005 – 2006: Worked on the ICP program for the UK data

3. 3 Machinery and Equipment and PPPs: Survey 2011

4. 4 ….following by discussion…. Topics to covered Background Objectives and approach Methodology and work proposals Pilot survey The structure and content of the core product list Pilot survey: arrangements Future activities Summary

5. 5 ….these bodies have co-operated for many years…. Background The ICP program 2005 - 2006 Eurostat surveys Work and experience from other organisations, principally OECD ….sources and experience ….

6. 6 Overall objectives To prepare a core list of products to be used for the regions To achieve a list that will reflect products available in all regions To include representative and identical products across all regions To prepare associated data recording and analysis methods …..regions will have their own lists for their countries….. …..principally to development a core product list…

7. 7 ….conclusion: difficult for analysis and difficult to compare prices…. The ICP survey: 2005 - 2006 General specifications - holistic Difficult to price – too vague Skewed towards some BHs List biased towards N. American makes and models Two BHs were omitted ….some problems….

8. 8 ….to learn from the lessons from the past……. Approach: 2010 – 2011 To move towards the Eurostat approach To include at least some specific identical and representative products To reflect global markets and products To integrate the products, data collection and analysis

9. 9 ….a significant trend in the last few years……. Approach: comments Increasing penetration of global markets by multi-national companies Increasing availability of products internationally This will facilitate finding identical products across regions

10. 10 Methodology Study of previous survey results Evaluate other lists and work Research new products, as appropriate Develop the structure of the list Discuss and finalise the list Design of specification sheets Plan analysis methods …..to end up with a core product list ready for the main survey in mid-2011…

11. 11 ….the main survey will take place in mid-2011….. Proposals Start with the Eurostat list for the 2009 survey Include results for the ICP 2005 – 2006 as appropriate The list will be divided between generic and specific products There should be an initial pilot survey Data recording and analysis methods will be adapted from Eurostat

12. 12 The pilot survey ….is the emphasis of the presentation today….

13. 13 ….the first step is the pilot survey…. Pilot survey: objectives (1) To test the overall approach To determine which generic products and items are submitted To determine the extent to which specific products are found To determine the extent to which makes and models not included in the initial list (equivalent) are submitted ….important to carry out initial work before the main survey….

14. 14 ….the first step is the pilot survey…. Pilot survey: objectives (2) To ensure that the final list reflects global makes and models To remove bias from initial list To ensure that the final list is balanced across the regions ….important to carry out initial work before the main survey….

15. 15 ….implementation - later in 2010 …. Pilot survey: comments Carry out the pilot survey in two regions Finalise draft core product list To decide about the efficacy of the proposed method Implementation ….pilot survey is the next stage of the work…..

16. 16 ….and reflect across regions……. The core product list A list including all 17 BHs There will be more or less an equally number of products in each BH A combination of specific and generic products and items The products included are based on the list of the ICP survey and the Eurostat 2009 list ……to aim to select representative and identical products across all BHs…..

17. 17 ….the list is split into products and items… Products and items A product defines a group of specific pieces of machinery or equipment Products are defined in the classification of BHs For our purposes products are sold in commercial markets as opposed as in consumer markets An item is a sub-division and a variation of a product (e.g. a particular model and/or make of a product)

18. 18 ….but constrained by the classification….Classification Based on CPA 1996 Sometimes difficult to find suitable products in some BHs Out-of-date The technology has moved on Practical problems - some products cannot be realistically priced, e.g. planes ….the products defined within in each BH…..

19. 19 ….starting point for the core product list…. Sources The product list for the 2005 – 2006 ICP survey The 2009 Eurostat list Other documents, including classification lists ….list based on existing work…..

20. 20 The core product list: summary

21. 21 ….at this stage structure more important than specific products… Comments on the core product list All 17 BHs are included Approximately the same number products for each BH (at the moment) Divided by generic and specific Sub-divided into products and items …..initial proposals….

22. 22 ….found in various BHs…. Generic products/items One: where generic products/items have their own special specifications Two: where generic products/items are related to the specific products/items Two types, as below:

23. 23 The core product list: example (1)

24. 24 ….found in some other BHs………. Example (1): explanation BH I: Fabricated metal products Split by generic (unspecified) and specified products (makes and models) Items under products, as appropriate Generic products have special specifications No specific makes/models for these products..where generic items have special specifications..

25. 25 The core product list: example (2)

26. 26 ….where generic products/items are related to special products………. Example (2): explanation BH II: Engines and turbines Split by generic (unspecified) and specified products (makes and models) Items under products, as appropriate Generic products/items have no special specifications ….similar as for the other BHs……….

27. 27 ….to finalise the list for the pilot survey…. Further activities: the core product list Types of products in each BH Split of generic and specific products Items under each product Research new products (if any) Preparation of specification sheets ….discussion and agreement….

28. 28 ….need current makes and models…. The core list: checking Availability of products Ensure makes are current Ensure models are current Update all specifications..as near as possible to the start of the fieldwork…. Product life cycles Particular attention to BH XI Computers and BH XVII Software NB:

29. 29 ….the next steps…. Pilot survey: arrangements Preparation of the final specification sheets Decisions regarding data collection Development of the methods and tools for analysis Timing

30. 30 ….test the product list and the methodology…. Pilot survey: fieldwork Two contrasting regions:  One “difficult”, e.g. Africa  One “different”, e.g. Asia Try to research ALL products and items, including generic and specific Propose any new products

31. 31 ….to refine the list……. Pilot survey: analysis Evaluation of the results Examine generic products/items Examine specific products/items Analysis of equivalent products submitted in specific positions Form groups/splits from products/items that worked Incorporate any new products/items Evaluate the overall structure of the list

32. 32 ….the target will be to finish the core product list for the main survey…. Post-pilot survey activities Combine generic and specific products/items Delete any products/items Research current products and items Finalise the structure of the list Checking the list Finalise specification sheets/data collection methods Finalise analysis procedures and tools needed

33. 33 ….main fieldwork will take place in mid-2011 Summary Further work on the core product list Agree the structure and content of the list Finalise the list Finalise plans for the pilot survey Implement the pilot survey Analyse results Preparation of the core product list for the main survey

34. 34 ….. thank you very much…..