Collecting data on household expenditure

Draft Chapter 5 of International Comparison Programme – a Handbook

Collecting data on household expenditure

Will talk about background because relevant to explain what I stress. Heavily influenced by what went wrong last time. Important not to repeat same errors.

Collecting data on household expenditure

Where I come fromSurvey takingLatin America – all countries in South AmericaCPI in EcuadorHarmonization of CPI in Southern tipRegional development in IndiaPrices division in Stats Canada

Collecting data on household expenditure

Organizational subjectsICP a special projectAwful trouble last roundCanada and Australia decided to terminate itUN Statistical Commission - give it one more chanceCompromise - an evaluationEvaluators - sharpest critics of ICP

Collecting data on household expenditure

All continents and Economic CommissionsInterested in opponents of initiativeLooked into failuresWhy was Latin America late?Why no official figures for LA?Why was India adamant against?In Africa: why virtual collapse?

Collecting data on household expenditure

Findings: bad managementIncapacity to use resources efficientlyNo one in chargeUnderfinancedNot explicit about objectivesNo mutual trust among countriesNo understanding of listExercise perceived as opaqueLittle contact with regional authorities

Collecting data on household expenditure

Decision to go regional 20 years oldAt time no one questioned itCountries felt decision honoured in the breachFew contacts outside World BankNo usable Handbook No practical guidance

Collecting data on household expenditure

Spoke to usersCavalloSecretary of Planning in IndiaMichael BrunoUnder secretaries of Finance All said: arcane, obsolete, unreliableRather use exchange rates

Collecting data on household expenditure

Contacts pitched much too lowMostly: statistical officesMost directors unawareFew interested in outcomeInept coordinationStarting position : strategic weakness

Collecting data on household expenditure

DefinitionsScope is regionComments also apply to sub-regionNational coordinator could be one of twoI/C pricing and household budget surveyI/C National Accounts must be awareNational coordination importantTwo institutions

Collecting data on household expenditure

Governance discussedGlobal management as wellChapter 4 to 5 - transition from centre to regionRegional coordinator and national counterpartsTransmission and understanding of instructionsInforming of progressHow RC supports national counterpartsHow counterparts relate to each otherWhere relationship takes place

Collecting data on household expenditure

Time objectives clearNo allowance for tardy repliesValue of results will sufferRespect for timetable profoundInformation on progress continuousThreats to timetable RC and counterparts - communication tools Surprises for cause - unacceptable

Collecting data on household expenditure

RC should have network of high level contacts including Influence prioritiesReferee in inter institutional conflictJudge on adequacy of resources to meet endsInvolved in matters of substanceDiscretion to adjust proceduresPublic relations - exercise consistent with national interestsDoes not interest exclusively World Bank

Collecting data on household expenditure

There is a Products listNational coordinators round a tableReview of goods and services Cataloguing of gaps and differencesDifferences between selected and CPI Deviation from CPI Exchange of photographs

Collecting data on household expenditure

“Internalization” of IPCUnderstanding of objectivesRespect for timetableTracking progress to avoid surprisesCreation of a networkTrustCollective approvalPhotographyJoint decisions

Collecting data on household expenditure

Cannibalizing CPICPI - an infra structureTrained staff and supervisorsKnowledge-how households spend their moneyFamiliarity - way goods and services marketedWhat is not representativeWhere to look for replacementsIndications of sample sizePricing has time dimension

Collecting data on household expenditure

How often should consumer goods be priced?Every quarterPrice taking by right work forceDress rehearsal to detect outliersOutliersErrors of fact and misjudgementImprudent to leave detection to last minute

Collecting data on household expenditure

Quarterly pricing - same discipline as CPIDisappearance -temporary or definitiveSeasonalityReplacementsOutlet replacementSample sizeProportional to variability in CPI

Collecting data on household expenditure

Relevance and trustCut-off dateWhoever does not meet it is outDiscriminatory in favour of large countries RC to create working web pageParticipants aware of each other’s progressTC and questions and answers

Collecting data on household expenditure

Capacity to inspect basic dataConfidentialityAveraging requiredMasking affects trustWays round provisions of actPricing outside the statistical officeLoss of CPI advantagesBut could be used for subset

Collecting data on household expenditure

Special privileges to RCSpecial privileges to RC’s venueSpecial privileges to national coordinatorsAveraging - consistent among countriesAveraging - reasonableAccompanied by supporting informationNumber of observations and range

Collecting data on household expenditure

Editing in two venuesNational editing - editing for average pricesAlso quarter to quarter changesOutliers - batch checkingPrice interviewer; product; locality; outletExtreme outliers (temporarily 2σ )Not in national averages

Collecting data on household expenditure

New localities, capital and main cityInter country editingUse marked information Exclude extremesRefer them for checkingAlarm if extremes increase over timeVisit country

Collecting data on household expenditure

Transmission - standard systemRecording - standard layoutMost detailed product coding by type of establishment, national averageChallenged by peersEvidence by photoBy number of quotationsBy description

Collecting data on household expenditure

Participants have a working statistical officeOffice produces CPI regularlyStaff for CPI collection and compilation Contacts with retail networkProcedure to deal with missing productsCertified processing system Not assumed: product replacement procedureAdjustment for small quality variationsGood knowledge of complex products

Collecting data on household expenditure

Participants who fail to meet initial conditionsRequire basic capability building pre HandbookBut problem of national coverageAssume only minority have national coverageRC will help establish missing facilitiesFunctioning network when pricing gets startedMaterials translated into proper languageLead time for local adjustments

Collecting data on household expenditure

Forms for reportingPrice taker to national coordinatorChange in characteristics (standard)Plus action recommendedDisappearance Plus action recommendedDisappearance of outletPlus action recommended

Collecting data on household expenditure

AddendumDescription of special circumstancesSummary form for RCAfter full edit

Collecting data on household expenditure

Additional topicsSupplementary weightsSources enumerated in Chapter 4Trade associationsSpecialized magazinesCustoms declarations Chambers of Commerce

Collecting data on household expenditure

•Offices requiring basic assistance•Will be done through CPI•Use of standard instructions•Included in field manuals•Select respected practitioner•Example: BLS

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