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Innovative Approaches to Measuring Trends in Domestic and Global Output and Trade

Paper Session

Saturday, Jan. 5, 2019 2:30 PM - 4:30 PM

Hilton Atlanta, 314
Hosted By: Society of Government Economists
  • Chair: Susan Fleck, U.S. Bureau of Labor Statistics

Volume Output Measures and Price Indices of the United States Tertiary Education Services

Takashi Yamashita
,
U.S. Bureau of Economic Analysis

Abstract

The System of National Accounts and the National Academies of Sciences recommend that output of education services be measured by volume output rather than cost of production as currently done in national accounts for services provided by government entities and non-profit institutions. Measuring education services by volume is important as such output measures allow researchers to consider productivity of the education sector. This paper constructs volume measures of tertiary education services in the United States using three different metrics: the number of students enrolled, the number of credit hours taken, and the number of degrees awarded. I then compare the growth of volume output measures to the published NIPA numbers in higher education: government consumption expenditures and household consumption expenditures. Between 2004 and 2015, the volume output of full-time-equivalent students and credit hours increased at average annual rates of 2.5% and 2.3%, respectively, which grew slower than the government consumption expenditures in higher education (2.7%). On the other hand, household consumption expenditures on higher education grew little in those years (less than 0.1%) presenting discrepancies between the official statistics and what universities actually produce.

The source of discrepancies seems to lie in the price indices used to deflate higher education services. I construct price indices from tuition revenues of universities and net tuition payments by students after discounts and grants are taken into consideration. My estimates show that the GDP deflator used to deflate government services is lower than the price deflator calculated from tuition revenues of public universities while the PCE deflator for higher education substantially overstates the inflation rate of household spending on tuitions. This research points to further areas of possible improvements in how we measure output of education services and price index for it, which in turn could lead to changes in GDP measurement.

Valuing Housing Services in the Era of Big Data: A User Cost Approach Leveraging Zillow Microdata

Marina Gindelsky
,
U.S. Bureau of Economic Analysis
Jeremy G. Moulton
,
University of North Carolina-Chapel Hill
Scott A. Wentland
,
U.S. Bureau of Economic Analysis

Abstract

Historically, residential housing services or “space rent” for owner-occupied housing has made up a substantial portion (approximately 10%) of U.S. GDP final expenditures. The current methods and imputations for this estimate employed by the Bureau of Economic Analysis (BEA) rely primarily on designed survey data from the Census Bureau. In this study, we develop new, proof-of-concept estimates valuing housing services based on a user cost approach, utilizing detailed microdata from Zillow (ZTRAX), a “big data” set that contains detailed information on hundreds of millions of market transactions. Methodologically, this kind of data allows us to incorporate actual market prices into the estimates more directly for property-level hedonic imputations, providing an example for statistical agencies to consider as they improve the national accounts by incorporating additional big data sources. Further, we are able to include other property-level information into the estimates, reducing potential measurement error associated with aggregation of markets that vary extensively by region and locality. Finally, we compare our estimates to the corresponding series of BEA statistics, which are based on a rental-equivalence method. Because the user-cost approach depends more on the market prices of homes, we find that since 2001 our initial results track aggregate home price indices more closely than the current estimates.

Measuring United States International Trade in Manufacturing Services Using U.S. Customs Records

Abdul Munasib
,
U.S. Bureau of Economic Analysis

Abstract

This paper reports the findings of an ongoing project that explores the feasibility of estimating U.S. international trade in manufacturing services using the Census Bureau’s Longitudinal Firm Trade Transactions Database (LFTTD) that compiles, by firm, transaction-level data collected by the U.S. Customs and Border Protection. A portion of the customs-based trade transactions reflects goods sent abroad for processing and returned to the United States (roundtrip trades) without the goods changing ownership from the U.S. resident to a foreign resident. To align with international standards for compiling balance of payments statistics, such as those reflected in the U.S. International Transactions Accounts, the value of goods exported for processing and imported after processing without a change in ownership should be excluded from exports and imports of goods and included in imports of manufacturing services. Because U.S. customs records do not identify exports or imports of goods for processing, my objective is to identify roundtrip trades where U.S. firms export intermediate inputs and then import goods that have been processed from these inputs. Assuming that ownership of the materials is retained by the exporting firm during the roundtrip trade, and that sourcing of materials either from the processing country or a third country is not significant, the difference between the import and the export values may be a proxy for imports of manufacturing services.
I have developed a method to identify a sample of firms that engaged in roundtrip trades of manufactured goods for the years 2007-2013. To identify roundtrip trades, I use an index of product “upstreamness” or average distance from final use developed by Antras, Chor, Fally, and Hillberry (AER, May 2012) for 426 industries based on the 2002 input-output tables produced by the Bureau of Economic Analysis. I apply this index to trade in goods at the 6-digit Harmonized System (HS) product level to identify potential firm-country pairs where firms are exporting products that are relatively upstream in the production sequence and importing products that are relatively downstream.
This paper estimates imports of manufacturing services only for firms that imported from a single country to limit my initial investigation to the simplest value chains. In the next stage of my research, I hope to expand the estimates to include firms that trade with multiple countries and that have more complex value chains.

Accounting for Firm Heterogeneity within U.S. Industries: Extended Supply-Use Tables and Trade in Value Added using Enterprise and Establishment Level Data

Kassu Hossiso
,
U.S. Bureau of Economic Analysis
James J. Fetzer
,
U.S. Bureau of Economic Analysis
Tina Highfill
,
U.S. Bureau of Economic Analysis

Abstract

This paper presents experimental trade-in-value added (TiVA) statistics estimated from extended supply-use tables (SUTs) for the United States for 2005 and 2012 that account for firm heterogeneity. The tables used to estimate the TiVA statistics extend supply-use tables for the United States by disaggregating the components of supply and use by multinational and other firms. We also present preliminary output from a microdata linking project between the U.S. Bureau of Economic Analysis (BEA) and the U.S. Census Bureau on the U.S. semiconductor and other electronic components manufacturing industry to show how different firm characteristics account for heterogeneity within industries in an extended SUT framework. The rise of global value chains has increased the importance of measuring trade on a value added basis and identifying trade by multinational enterprises when analyzing bilateral trade flows. Our experimental results show that imported content of exports as a share of exports varies notably by firm-type within most industries, and that the imported content of exports is concentrated in a few industries, the largest being petroleum manufacturing. In addition, we find that half of the domestic value added content of exports by foreign-owned U.S. businesses is in chemicals, motor vehicles, wholesale trade, and machinery and that most of this content is embodied in imports from upstream foreign affiliates. Estimates based on our microdata linking project suggest that production patterns by ownership, firm class size, and export intensity each exhibit firm heterogeneity to some extent. The ownership criteria best accounts for heterogeneity in the value added share of production among the three criteria, while firm class size accounts for heterogeneity in the export share of production better than the ownership criteria. However, the three criteria are highly correlated and we make no attempt here to isolate the individual effects of each.
Discussant(s)
Gregory Kurtzon
,
U.S. Bureau of Labor Statistics
Randal Verbrugge
,
Federal Reserve Bank of Cleveland
Kim J. Ruhl
,
Pennsylvania State University
Stephen R. Yeaple
,
Pennsylvania State University
JEL Classifications
  • E0 - General
  • F0 - General