STUDIES IN METHODS Series F No. 62
ST/ESA/STAT/SER.F/62
HANDBOOK OF THE INTERNATIONAL COMPARISON PROGRAMME
DEPARTMENT OF ECONOMIC AND SOCIAL DEVELOPMENT
STATISTICAL DIVISION
UNITED NATIONS, New York, 1992
UNITED NATIONS PUBLICATION
Sales No. E.92.XVII.12
ISBN 92-1-161350-7
Copyright (c) United Nations, 1992. All rights reserved.
The Handbook of the International Comparison
Programme is a United Nations
publication, Sales No. E.92.XVII.12, copyright (c) 1992 by the United
Nations, all rights reserved. It is distributed on Internet for information
and for the convenience of users. Printed and bound copies may be purchased
from United Nations Publications. The Handbook is also available
in French, Russian, Spanish, Chinese and Arabic translations.
No part of this publication may be reproduced or transmitted
in any form or by any means, electronic or by any information storage
and retrieval system, without permission in writing from the publisher.
NOTE
Symbols of the United Nations documents are composed
of capital letters combined with figures.
GENERAL DISCLAIMER
The designations employed and the presentation
of material in this publication do not imply the expression of any opinion
whatsoever on the part of the Secretariat of the United Nations concerning
the legal status of any country, territory, city or area or of its authorities,
or concerning the delimitation of its frontiers or boundaries.Where the
designation "country or area" appears in the headings of tables, it covers
countries, territories, cities or areas.
CONTENTS
- INTRODUCTION
- Purpose of the Handbook
- The place of the ICP in international
statistics
- National price levels and
related concepts
- National accounts and the
ICP
- The ICP problem in outline
- Value of the ICP data provision
to country statistical offices
- Uses of the outputs of the
ICP
- EXPENDITURE
DATA NEEDED
- Gross domestic product as
defined for ICP purposes
- Sectoring of the expenditure
accounts
- Household consumption
- Some consumption boundaries
- Consumption financed
by other sectors
- Government consumption
- Capital formation
- Net exports
- Dating of expenditure totals
and details
- Breakdown of GDP by aggregations
of basic headings
- Breakdown of GDP by basic
headings
- TASKS
RELATED TO PRICE DATA
- Outline of price requirements
- Some principles of item selection
- Temporal and ICP price
sampling
- Importance and identity
- Number of items per basic
heading
- Obtaining national average
annual prices
- Annual average prices
- National average prices
- With outlet price variation
and quantity weights
- With outlet variation
but without quantity weights
- PRICE
ESTIMATION AND ADJUSTMENT PROCEDURES
- Indirect price comparisons
- Education
- Collective consumption of
government
- Medical services
- Hedonic estimation and other
price-slope adjustments
- Hedonic price estimation
- Price-slope adjustments
- Size of purchase and package
- Consumer durables and
machinery and equipment
- Construction
- Some miscellaneous pricing
issues
- Equivalence in use
- Identity of product
- PROCESSING
OF THE BASIC DATA
- Purchasing-power parities
for basic headings
- The EKS method
- The CPD approach
- Aggregation of the basic heading
parities up to the level of GDP
- The G-K and EKS methods
in brief
- Linking of regional results
and the fixity question
- Extrapolation of benchmark
estimates to other years
PREFACE
The present Handbook is part of
the technical documentation prepared for phase VI of the International
Comparison Programme (ICP). The ICP is a world programme to produce estimates,
comparable across countries in real terms, for the gross domestic product
and its main aggregates. In the process, purchasing-power parities are
obtained and used instead of exchange rates for converting data into a
common currency.
The aim of the present document
is to contribute to spreading technical knowledge needed at the national
level by staff responsible for work on the ICP, especially in developing
and newly participating countries. It deals mainly with ICP data requirements
and offers guidance for related country operations. Moreover, the document
is expected to help promote uniform understanding of the methodological
principles in various countries and regions, thus ensuring minimum ICP
standards to obtain comparable regional results and to facilitate linking
them into a world comparison.
There is a wide range of written
information available on general methodology of international comparison
of prices and volumes, mainly published along with the reports on previous
phases of the ICP. However, in the 25-year history of ICP, this is the
first attempt to publish a Handbook that includes practical instructions
on how participating countries should act in order to achieve a successful
application of the general methods. Reflecting the needs for practical
guidelines on the tasks country statistical offices have to carry out,
the United Nations Statistical Commission, at its twenty-fifth session,
gave priority to the publication of a Handbook for the ICP. 1/
In preparing the Handbook, the
Statistical Division of the Department of Economic and Social Development
received valuable assistance from a variety of sources. The conceptual
framework and initial outline of the Handbook were elaborated by the late
outstanding ICP experts, Messrs. Hugo Krijnse-Locker and Laszlo Drechsler.
Acting as a consultant to the Secretariat, Mr. Drechsler prepared major
portions of the first draft of the Handbook, which was supplemented by
the work of Mr. Michael Ward of the World Bank. Professor Alan Heston
of the University of Pennsylvania, with financial support from the World
Bank, assisted the Secretariat by preparing a revised version of the full
text of the Handbook. This draft text was widely circulated for comments
and, working closely with the Statistical Division, Professor Heston incorporated
the various comments received into the draft. The working document on
the expenditure classification, included in annex III, was prepared by
the Secretariat.
In its present form, the Handbook
reflects, to the extent possible, the various useful suggestions forwarded
to the Statistical Division during the several rounds of consultations
with experts. In this regard, the substantial contributions of national
and international organizations, such as the World Bank, the Organisation
for Economic Cooperation and Development, the Austrian Statistical Office
and the Institut national de la statistique et des études économiques
(INSEE) of France, deserve particular mention. Naturally, one publication
cannot answer all the questions in a programme as complex as the ICP.
Thus, although the Handbook is intended to serve as a major source of
information on ICP methods and their application, it will need to be supplemented
by additional technical documents from time to time. Moreover, it is meant
to be used together with any documentation prepared for the regional comparisons
associated with ICP.
It is possible that, on the basis
of further experience with comparison work in phase VI, it will be found
useful to issue a revised ICP Handbook sometime in the future. The Statistical
Division welcomes communications from users of the Handbook, country and
international organizations involved in ICP work, concerning their experiences
with the applicability of the Handbook.
1/ Official Records of the Economic
and Social Council. 1989, Supplement No. 3 (E/1989/21), para. 108.
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