Transcript Catastrophic Natural Disaster and National Accounts: Japanese

CATASTROPHIC NATURAL
DISASTER AND NATIONAL
ACCOUNTS: JAPAN’S EXPERIENCE
Working Party on National Accounts, OECD,
Paris
25-28 October, 2011
Kosuke SUZUKI
Department of National Accounts
Economic and Social Research Institute
Cabinet Office of Japan
OUTLINE OF THE GREAT EAST
JAPAN EARTHQUAKE

Occurred at 2:46 pm (JST) on 11 March
Epicenter: ｔhe northeast of Japan
 Seismic scale: M 9.0
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The extent of damage
Around 20,000 are dead or missing
 More than 70,000 are still living in temporary
shelters.
 Amount of damage in tangible assets: 16.9 trillion
yen ($ 220 billion)


cf. Japan’s nominal GDP in 2010: 479 trillion yen
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OUR CHALLENGES: PAST AND
FUTURE
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Source data problems
Delay
 Missing
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Modification in compilation methodology
Projection
 Adjustment
 Scope
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Conceptual issues
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Treatment of unusual economic transactions
User Communication
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SPECIAL TREATMENT IN
QUARTERLY NATIONAL ACCOUNTS:
OVERVIEW

Quarterly National Accounts in Japan
GDP (expenditure side), its components, and compensation
of employees
 Release schedule
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Advance estimates: after approx. 1 month and 2 weeks
 Revised estimates: after approx. 2 months and 10 days
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Advance GDP estimates for the first quarter of 2011
were due out on 19th of May…
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SPECIAL TREATMENT IN
QUARTERLY NATIONAL ACCOUNTS:
PROJECTION

Mechanical projection in the advanced estimates

In advanced estimates, some data for the third month of the
reference quarter cannot be obtained.
Huge deviations were obviously expected…
 WE NEEDED to maintain the accuracy of our
estimates and to avoid a later big revision.
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Usage of alternative data
Other proxies
 Data published by private business associations
 Anecdotal information
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FIGURE 1: UNPRECEDENTED
FLUCTUATION IN SOURCE DATA
An illustration: Sales of Amusement and Theme Parks
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(Source) “Survey of Selected Service Industries” (METI). Trend estimate is calculated by author.
FIGURE 2: REVISION TO THE
ADVANCE ESTIMATES
Comparison of growth rates for Q1 2011
（Changes from previous quarter, %, seasonally adjusted, chain volume）
Advance estimates Revised estimates
Gross Domestic Product
Private consumption
Private residential investment
Private non-residential investment
Private inventory (*)
Government consumption
Public investment
Public inventory (*)
Exports
Imports
-0.9
-0.6
0.7
-0.9
-0.6
0.7
-0.9
-0.5
1.0
-1.3
0.0
0.7
2.0
-1.3
-0.4
0.9
-1.4
0.0
0.7
1.9
(Note) Figures for inventories are contributions to GDP growth rates.
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SPECIAL TREATMENT IN
QUARTERLY NATIONAL ACCOUNTS:
SOURCE DATA

Revised GDP estimates are calculated using “Financial
Statements Statistics of Corporations by Industry” (FSSCI,
Ministry of Finance).

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Investment and inventory series
Revised GDP estimates were due out on 9 June.

Delay in FSSCI publication
Provisional results for Q1: 2 June
 Final results for Q1: 29 July
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Adjustment in investment estimation

Revision to private investment: -1.3% → -1.4%
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SPECIAL TREATMENT IN
QUARTERLY NATIONAL ACCOUNTS:
OTHER ISSUES
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Adjustment in parameters
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Conceptual Issues
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Work-in-progress of housing construction, etc.
Example: clearance of rubble
User communication: advance announcement
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Timing
27 April for the advance estimates (published 19 May)
 1 June for the revised estimates (published 9 June)
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Contents
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ISSUES FOR ANNUAL ESTIMATES

Annual National Accounts in Japan
Fiscal year: from April to March of next year
 Released in winter of next year
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Estimates for Fiscal 2011 will be due out in December
2012/January 2013
Items we need to tackle:
Source data problems
 Reconsideration of estimation methodology/scope
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Example: treatment of “transfers”
Conceptual issues
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Example: estimation of nonlife insurance services
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IMPLICATION/ISSUES FOR
DISCUSSION
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Good opportunity to review current estimation
framework
Dealing with source data problems
 Adjustment in estimation methods
 Revisiting conceptual issues
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There is also a need to consider data sources and estimation
methods for new items.
Improvement in public relations
Conceptual issues: some borderline cases
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Are benefits in kind to victims collective or individual
consumption?
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