Global Production Mark de Haan. Global Production 1 Content presentation 1.Background 2.Changes 2008...
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Transcript of Global Production Mark de Haan. Global Production 1 Content presentation 1.Background 2.Changes 2008...
Global Production
Mark de Haan
Global Production 2
Content presentation
1. Background
2. Changes 2008 SNA
3. Discussion points
a. Conceptual
b. Measurement related
4. Way forward
Global Production 3
1. Background
• Changes 2008 SNA• Globalisation guide• Global manufacturing (or production more
generally) as cross cutting issue (chapter 8)
• Further investigation of unsolved issues
Global Production 4
2. Key changes 2008 SNA and BPM6
• No exceptions to recording transactions on basis of economic ownership
• Implications recording of processing, merchanting, intra-company trade
• ..
Global Production 5
2. Key changes 2008 SNA and BPM6
Principal
Principal
Processor
1993 SNA recording (‘gross’):
2008 SNA recording (‘net’):
(G) 50
(G) 80
Processor
(S) 30
Global Production 6
2. Key changes 2008 SNA and BPM6
• No exceptions to recording transactions on basis of economic ownership
• Implications recording of processing, merchanting, intra-company trade
• R&D capitalization→ Capital flows→ Capital services flows
Global Production 7
3a. Conceptual discussion points
• Categorisation of global production arrangements
• Factory-less producers • ..
Global Production 8
3. Conceptual issues
Principal(domestic economy)
Processor (abroad)
Production abroad
Material inputs
Material outputs
= information= products
turnover productioncost
= money
Global Production 9
3. Conceptual issues
Principal(domestic economy)
Processor (abroad)
Production abroad
Material inputs Material outputs
= information= products
turnover productioncost
= money
Process fee
Global Production 10
3. Conceptual issues
Principal(domestic economy)
Contractproducer
(abroad)
Production abroad
Material inputs
Material outputs
Blueprints ofproduction
= information= products
turnover productioncost
productioncost
= money
Global Production 11
3. Conceptual issues
Principal(domestic economy)
Contractproducer(abroad)
Production abroad
Material inputs
Material outputs
Blueprints ofproduction
= information= products
turnover productioncost
productioncost
fee or purchase of products?
economic ownership of material inputs?
= money
Global Production 12
3. Conceptual issues
Principal(domestic economy)
Contractproducer(abroad)
Production abroad
Material inputs
Material outputs
Blueprints ofproduction
= information= products
turnover productioncost
productioncost
fee or purchase of products?
economic ownership of material inputs?
= money
Trader or Manufacturer?
Global Production 13
3a. Conceptual discussion points
• Categorisation of global production arrangements
• Factory-less producers • Identifying economic ownership within the
multinational• Multi-territory enterprises (pro-rating)
such as construction companies and project vendors
• Recording intra company R&D flows
Global Production 14
3b. Measurement issues
• Merchant trade statistics based on cross border registration (processing, merchanting)
• Measuring inventories abroad (idem) • Asymmetry outward processing• ..
Global Production 15
Principal-processor relationships in the Netherlands of 35 selected companies, turn over in billion €
Increase(passive)
Decrease(active)
Total
Domestic + 1.4 - 7.8 - 6.5
Abroad + 4.8 -6.9 - 2.0
Total + 6.2 -14.7 - 8.5
3b. Measurement issues
Remark: the -6,5 billion € production value adjustment shouldnot show up in macro totals
Global Production 16
3b. Measurement issues
• Merchant trade statistics based on cross border registration (processing, merchanting)
• Measuring inventories abroad (idem) • Asymmetry outward processing• Intellectual property (legal versus economic
ownership)• Big and complex cases units (…, Ireland,
Netherlands, Norway, Sweden, …): determining the domestic economic activities of multinationals
Global Production 17
Current and further work in this area
• Eurostat taskforce on goods for processingbuilding on the globalisation guide
• CES working group global production (to be expected)
• ESSnet project on measuring global value chains (a micro level research)
• IARIW Conference 2012 session (8a) – ‘How to capture multinationals in national accounts?’
Global Production 18
Thank you!