Construction price indices

European Commission Eurostat

Description

Sources and methods
Industry, trade and services

Informations

• Publié par: EUROPEAN-COMMISSION-EUROSTAT
• Nombre de lectures: 8
• Langue: English
• Poids de l'ouvrage: 3 Mo

Extrait

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MAIN ECONOMIC INDICATORS STATISTICS DIRECTORATE
CONSTRUCTION
PRICE INDICES
Sources and Methods
ORGANISATION FOR ECONOMIC CO-OPERATION AND DEVELOPMENT
STATISTICAL OFFICE OF THE EUROPEAN COMMUNITIES ORGANISATION FOR ECONOMIC CO-OPERATION
AND DEVELOPMENT
Pursuant to Article 1 of the Convention signed in Paris on 14th December 1960, and which came into force
on 30th September 1961, the Organisation for Economic Co-operation and Development (OECD) shall promote
policies designed:
- to achieve the highest sustainable economic growth and employment and a rising standard of living in
Member countries, while maintaining financial stability, and thus to contribute to the development of the
world economy;
- to contribute to sound economic expansion in Member as well as non-member countries in the process of
economic development; and
- to contribute to the expansion of world trade on a multilateral, non-discriminatory basis in accordance
with international obligations.
The original Member countries of the OECD are Austria, Belgium, Canada, Denmark, France, Germany,
Greece, Iceland, Ireland, Italy, Luxembourg, the Netherlands, Norway, Portugal, Spain, Sweden, Switzerland,
Turkey, the United Kingdom and the United States. The following countries became Members subsequently
through accession at the dates indicated hereafter: Japan (28th April 1964), Finland (28th January 1969),
Australia (7th June 1971), New Zealand (29th May 1973), Mexico (18th May 1994), the Czech Republic
(21st December 1995), Hungary (7th May 1996), Poland (22nd November 1996) and the Republic of Korea
(12thr 1996). The Commission of the European Communities takes part in the work of the OECD
(Article 13 of the OECD Convention).
Publié en français sous le titre :
INDICES DES PRIX A LA CONSTRUCTION
Sources et méthodes
© OECD, Eurostat, 1997
Applications for permission to reproduce or translate all or part
of this publication should be made to:
Head of Publications Service, OECD
2, rue André-Pascal, 75775 PARIS CEDEX 16, France. FOREWORD
This publication is the result of joint work between the Statistics Directorate of the Organisation for Economic Co­
operation and Development (OECD) and the Statistical Office of the European Communities (EUROSTAT). The
objectives of this collaboration were to outline conceptual problems in the development of construction price indices,
based on a comparative description of the methodologies currently used by Member countries of the OECD and the
European Union.
Such information will enable national statistical institutes, or other organisations compiling construction price
indices, to compare their methodology and data sources with those currently used in other countries. It will also
provide a range of options for countries in the process of creating their own indices, or overhauling existing indices.
At present there is very little multi-country documentation available on construction price indices.
The level of activity in the construction sector is one of the key determinants of the level of short-term economic
activity in Member countries. The demand for reliable construction price indices arises from the need to assess real
changes in the output from these activities which cannot be derived solely through reference to regular building and
construction statistics. These indices have a wide range of applications including deflation of components of national
accounts, adjustment of construction contracts and leases, and as a basis for indexation for insurance purposes.
At the moment, there is considerable variation in the concepts underlying the compilation of construction price
indices by Member countries, as well as in the price components and methodologies used. This variation is the result
of the different administrative and legislative environment, and differing physical characteristics, such as geographic
size, population density, climate, etc. in which organisations undertaking construction activity operate in each
country. Another factor are the different uses of the construction indices compiled.
The Statistics Directorate of the OECD and EUROSTAT are greatly indebted to the statistical offices of OECD and
European Union Member countries for their co-operation. Without this assistance, it would not have been possible to
produce this publication.
This publication is presented on the joint responsibility of the Secretary General of the OECD, and the Director-
General of EUROSTAT.
Louis Kincannon Yves Franchet
Director Director-General
Statistics Directorate EUROSTAT
OECD TABLE OF CONTENTS
Page
Introduction 9
Section 1: Basic Concepts 11
A. Relationship of producer price indices to construction price indices 1
Terminology used in this publication
Elements of construction industry prices2
Construction price indices
B. Main types of construction price indices 14
Input price indices
Output price indices
Seller's prices
Relation between the three types of indices5
Types of construction price indices compiled in OECD and European Union Member
countries 1
C. Typology of methods used by OECD and European Union Member countries
for compiling construction price indices9
Prior breakdown methods
Standard factors
Component cost method
Subsequent breakdown methods 20
Quoted prices
Schedule of prices
Matched models
Building volume or area
Hedonic method
D. Outline of processes in developing a construction price index 22
E. Uses of construction price indices3
Use ofn price indices for deflating components of national accounts 24
Section 2: Construction Price Index Compilation Issues 26
A. Important considerations in the compilation of construction price indices
Diversity of construction activity
Changes over time 2
Selection of appropriate prices
Range of items for inclusion7
Ensuring geographic representativeness of the index8
Types of construction firms to include
B. Particular problems/issues for transition countries 2TABLE OF CONTENTS (cont.)
Page
C. Sources of information used to compile construction price indices 29
D. Major elements of construction price indices 30
Construction type/activity coverage
Geographic coverage1
Items in the index 32
Weights
Basis of prices3
Price collection4
Index review5
Index formulae6
Frequency of compilation/publication
Section: Description of Country Indices7
A. Explanatory notes
B. Input construction price indices 39
Australia
Austria 41
Belgium4
Canada5
Denmark8
Finland 5
France3
Greece7
Iceland
Ireland 60
Italy2
Japan6
Mexico
New Zealand9
Norway 71
Portugal3
Spain5
Sweden8
Turkey 80
United Kingdom
C. Output construction price indices3
Australia
Austria6
Canada 9
France2
Germany
Greece9 TABLE OF CONTENTS (cont.)
Page
Luxembourg 101
Netherlands3
New Zealand6
Norway8
Sweden Ill
United Kingdom 113
United States8
D. Seller's construction price indices 120
Canada0
Spain2
United States4
Section 4: Country Summary Tables6
Table 1: Main data sources used 126
Table 2: Methods for deriving weights 130
Section 5: International Classifications Relevant to the Compilation of Construction
Price Indices4
A. International Standard Industrial Classification (ISIC), Rev. 34
B. Statistical Classification of Economic Activities in the European Community
(NACE), Rev. 15
C. Provisional Central Product Classification (CPC)6
D. Classification of Types of Construction9
Bibliography 140
Glossary1 ABBREVIATIONS
CPI Consumer price index
ESA European System of National and
Regional Accounts in the
European Community
EUROSTAT Statistical Office of the European
Communities
GDP Gross domestic product
GFCF Gross fixed capital formation
ISIC International Standard Industrial
Classification
NACE Statistical Classification of
Economic Activities in the
European Community
Organisation for Economic Co­OECD
operation and Development
PPI Producer price index
SNA System of National Accounts
VAT Value added tax