The OECD STAN Database 1st World KLEMS Conference 19th-20th August 2010

1. The OECD STAN Database1st World KLEMS Conference 19th-20th August 2010  Colin Webb OECD STI/EAS

2. The STAN family STAN � industry: www.oecd.org/sti/stan Bilateral Trade by industry (STAN-BTD): www.oecd.org/sti/btd Business Expenditure on R&D by industry (STAN-R&D or ANBERD): www.oecd.org/sti/anberd Input-Output tables (STAN-IO): www.oecd.org/sti/inputoutput + derived set of �STAN Indicators�: www.oecd.org/sti/stan/indicators STAN � annual measures of output, labour input, investment, trade by detailed industry (2-digit +) c.f. EU KLEMS BTD � annual estimates of exports and imports of goods by industry and by partner. Generated using standard HS 1988 to ISIC Rev.3 conversion key. ANBERD � annual Business expenditure on R&D I-O � A set of I-O tables with common format for about 40 countries (incl. non-OECD). Inter-industry flows of domestic and imported intermediate inputs. c. 1995, 2000 and 2005 A snapshot of indicators based on above data sets e.g. Industry value added and employment shares, R&D intensity. Includes country zones. Usually produced every two years to complement STI Scoreboard publication. STAN � annual measures of output, labour input, investment, trade by detailed industry (2-digit +) c.f. EU KLEMS BTD � annual estimates of exports and imports of goods by industry and by partner. Generated using standard HS 1988 to ISIC Rev.3 conversion key. ANBERD � annual Business expenditure on R&D I-O � A set of I-O tables with common format for about 40 countries (incl. non-OECD). Inter-industry flows of domestic and imported intermediate inputs. c. 1995, 2000 and 2005 A snapshot of indicators based on above data sets e.g. Industry value added and employment shares, R&D intensity. Includes country zones. Usually produced every two years to complement STI Scoreboard publication.

3. Origins of STAN Early 1990s - Measurement and Analysis of Embodied Technology Diffusion. Impact on Productivity. Papaconstantinou, Sakurai, Wyckoff Tools developed: �Harmonised� Industry x Industry I-O Tables for 10 countries (1970, 80, 90); Bilateral Trade by industry, R&D by industry and a �STAN-industry� database. Compatible ISIC Rev.2 industry lists R&D intensities calculated: direct R&D + R&D embodied in intermediates and GFCF both domestically produced and imported. By-product = Technology classification Developed in OECD�s Science, Technology and Industry Directorate. Hence emphasis. STAN�industry is what many people refer to as The STAN Database. At the level of 26 ISIC Rev.2 industry groupings. R&D/output and R&D/value added Classifying manufacturing industries as high- medium-high, medium-low or low technology. Developed in OECD�s Science, Technology and Industry Directorate. Hence emphasis. STAN�industry is what many people refer to as The STAN Database. At the level of 26 ISIC Rev.2 industry groupings. R&D/output and R&D/value added Classifying manufacturing industries as high- medium-high, medium-low or low technology.

4. STAN mid-1990s Manufactures only � from 1970. 49 industries based on ISIC Rev. 2 7 measures � current price data only 16 OECD countries Primary source = SNA68 data Available to external users for US$ 290 Used for a range of STructural ANalyses and calculation of basic indicators The more aggregate ISDB included Agriculture, Mining, Construction and Services + an alternative aggregate set of 26 industries Production, GVA, Labour costs, employment, GFCF, exports and imports. SNA 68 did not use a �true� activity breakdown. �Producers of Government Services� provided separately and contents varied across countries. Some included public health, some public education, some both, some neither � An annual snapshot. Diskette � propriety format The more aggregate ISDB included Agriculture, Mining, Construction and Services + an alternative aggregate set of 26 industries Production, GVA, Labour costs, employment, GFCF, exports and imports. SNA 68 did not use a �true� activity breakdown. �Producers of Government Services� provided separately and contents varied across countries. Some included public health, some public education, some both, some neither � An annual snapshot. Diskette � propriety format

5. STAN today Covers whole economy � from 1970. About 100 industries based on ISIC Rev. 3 30 measures 30 OECD countries (data to 2008 for 24) Primary source = SNA93 data Distributed for free Rolling update (since 2000) STAN user distribution list (since 2000) Increased use for productivity analyses All economic activities including services. (ISDB discontinued in 1998) Full 2-digit ISIC Rev. 3 + additional detail (e.g. for high-tech industries and ICT) + various aggregate sectors; What can be found in SNA by activity: Production a/c. Volumes for Production, GVA, Intermediates, GFCF + Capital Stock (as provided by NSOs), employment and hours worked. OECD countries not yet included: Chile and Turkey. Not yet to 2008: Canada being finalised; USA :major revisions from 1998 released end-May � new estimates for earlier years expected end-2010; Japan; Australia; Portugal. SNA93 uses �true� activity breakdown based on ISIC Rev.3 Various outputs: Excel tables, ASCII, OECD.STAT. Rather than annual �snapshot� (approach now being more generally adopted at OECD). Thus for many users, became �de facto� source for latest (SNA) data by activity. Sometimes �frozen� e.g. STAN 2005 (prior to wholesale changes in methodology across many countries). Open dialogue with users � Some loyal users have remained on list for 10 years. From access statistics and feedback it is clear that it has been popular with researchers over the years as it provides a ready-to-use data set. For example, main source for GGDC 60-industry database prior to EU KLEMS project. Used within many other international orgs (ECB, IMF, WB, UN, EC DGs etc). Also, a principal source for GlobalInsight�s World Industry Database. All economic activities including services. (ISDB discontinued in 1998) Full 2-digit ISIC Rev. 3 + additional detail (e.g. for high-tech industries and ICT) + various aggregate sectors; What can be found in SNA by activity: Production a/c. Volumes for Production, GVA, Intermediates, GFCF + Capital Stock (as provided by NSOs), employment and hours worked. OECD countries not yet included: Chile and Turkey. Not yet to 2008: Canada being finalised; USA :major revisions from 1998 released end-May � new estimates for earlier years expected end-2010; Japan; Australia; Portugal. SNA93 uses �true� activity breakdown based on ISIC Rev.3 Various outputs: Excel tables, ASCII, OECD.STAT. Rather than annual �snapshot� (approach now being more generally adopted at OECD). Thus for many users, became �de facto� source for latest (SNA) data by activity. Sometimes �frozen� e.g. STAN 2005 (prior to wholesale changes in methodology across many countries). Open dialogue with users � Some loyal users have remained on list for 10 years. From access statistics and feedback it is clear that it has been popular with researchers over the years as it provides a ready-to-use data set. For example, main source for GGDC 60-industry database prior to EU KLEMS project. Used within many other international orgs (ECB, IMF, WB, UN, EC DGs etc). Also, a principal source for GlobalInsight�s World Industry Database.

6. Notable changes in source data since 1990s SNA 68 ? SNA 93 Classifications: ?NACE in EU, SIC ? NAICS. Valuation of SNA value added ? Basic prices SNA: Software ? investment Use of quality-adjusted �hedonic� deflators (ICT) SNA: Volumes: Fixed base ? Chained Laspeyres SNA: allocation of FISIM across industries EU: SNA activity detail; A17? A31? A60 (2-digit) Surveys: coverage, thresholds, definitions EU SBS units: establishments ? enterprises Improved quality in STAN depends significantly on improved quality of SNA by activity statistics provided by NSIs � and of course ISIC Rev. 2 ? ISIC Rev. 3 in STAN Previously, many countries used factor costs or producers� prices Software shift: All things being equal, intermediates down, VA up USA pioneers Chained Fisher in USA FISIM: All things being equal, intermediates up, VA down ESA 95. Making updates of EU countries in STAN easier over time � but diminishes differentiation of STAN from SNA SBS main source for estimating detail. Change in units changes industry composition. Primary activity rule. Why important? For World KLEMS, to extend series backwards and/or estimate more detail using vintage national data, need to understand characteristics of earlier versions. Also, for future reference, note that widespread changes in sources and methodology are implemented at different speeds by different countries. Makes �harmonising� data across countries rather challenging � Improved quality in STAN depends significantly on improved quality of SNA by activity statistics provided by NSIs � and of course ISIC Rev. 2 ? ISIC Rev. 3 in STAN Previously, many countries used factor costs or producers� prices Software shift: All things being equal, intermediates down, VA up USA pioneers Chained Fisher in USA FISIM: All things being equal, intermediates up, VA down ESA 95. Making updates of EU countries in STAN easier over time � but diminishes differentiation of STAN from SNA SBS main source for estimating detail. Change in units changes industry composition. Primary activity rule. Why important? For World KLEMS, to extend series backwards and/or estimate more detail using vintage national data, need to understand characteristics of earlier versions. Also, for future reference, note that widespread changes in sources and methodology are implemented at different speeds by different countries. Makes �harmonising� data across countries rather challenging �

7. STAN sources and updating cycle Update cycle starts in the summer � follows rhythm of releases of National Accounts by activity data July �October: most EU countries + Korea and Mexico November � January: Other non-EU OECD countries Most detailed SNA data provided directly by NSOs or via online extractions, but we may need to wait for Replies to official OECD/Eurostat annual SNA questionnaire Release of Industrial survey / census data (SSIS, SBS) Supply-Use tables if more detailed current price data output than official SNA tables Vintage data (SNA68, ISIC Rev.2) used to make estimates for earlier years New 2010/2011 STAN updating round (data to 2009) just beginning � although some updates from 2009/2010 round still pending. Replies to official SNA93 questionnaire may be required to maximise coverage for some countries: More industry detail provided to OECD and Eurostat than published online (e.g. Netherlands and Switzerland); or additional measures such as Hours Worked, GFCF and Wages and Salaries may be provided. (necessary for all measures for Hungary, Ireland, Poland and, eventually, Turkey) SSIS / SBS / census data for estimating current price detail. EU countries generally updated September � December. Japan too. Use tables exploited if National Accounts tables does not have comparable detail (i.e. A31 list only) . Disruption to update cycle when major revisions occur � e.g. latest USA data* + recently, Mexico and Korea, Australia � * USA; notable changes to VA and its components (particularly GOPS and taxes less subsidies) � resulting in significant changes to Labour shares (LABR/VA) by industryNew 2010/2011 STAN updating round (data to 2009) just beginning � although some updates from 2009/2010 round still pending. Replies to official SNA93 questionnaire may be required to maximise coverage for some countries: More industry detail provided to OECD and Eurostat than published online (e.g. Netherlands and Switzerland); or additional measures such as Hours Worked, GFCF and Wages and Salaries may be provided. (necessary for all measures for Hungary, Ireland, Poland and, eventually, Turkey) SSIS / SBS / census data for estimating current price detail. EU countries generally updated September � December. Japan too. Use tables exploited if National Accounts tables does not have comparable detail (i.e. A31 list only) . Disruption to update cycle when major revisions occur � e.g. latest USA data* + recently, Mexico and Korea, Australia � * USA; notable changes to VA and its components (particularly GOPS and taxes less subsidies) � resulting in significant changes to Labour shares (LABR/VA) by industry

8. STAN v. Similar industry list. Different country coverage. EU KLEMS: designed for advanced productivity analysis. Many more measures e.g. breakdown of intermediate inputs and labour inputs and a rich set of capital input estimates, but = heavier data requirements STAN: Frequent updates for a broader range of uses. STAN family includes R&D expenditure (ANBERD) ... � and exports and imports of goods by industry STAN leaves gaps when no alternative data sources to make estimates. Also, has notes at cell level to distinguish estimates from official SNA data STAN: more non-EU OECD countries; EU KLEMS: non-OECD EU Different users according to analytical needs and sensitivity to �rough estimates� ? Some researchers like complete data sets (with all cells filled) EU KLEMS has a few �rough estimates� e.g. via constant ratios. With STAN, researchers can fill missing detail according to type of analyses they are performing. Also, many researchers like to be able to distinguish between �official� data points and estimates. And even degrees of quality / reliability of estimates. Encourage data notes in EU KLEMS and World KLEMS. Differences between STAN and EUKLEMS output often due to differences in vintage / revision of underlying SNA data. But, for detail, also due to exploitation of micro-data sources by EUKLEMS consortium members in certain countries (?) � data that are out of reach for STAN. STAN and EU KLEMS complementary but convergence desirable. STAN: more non-EU OECD countries; EU KLEMS: non-OECD EU Different users according to analytical needs and sensitivity to �rough estimates� ? Some researchers like complete data sets (with all cells filled) EU KLEMS has a few �rough estimates� e.g. via constant ratios. With STAN, researchers can fill missing detail according to type of analyses they are performing. Also, many researchers like to be able to distinguish between �official� data points and estimates. And even degrees of quality / reliability of estimates. Encourage data notes in EU KLEMS and World KLEMS. Differences between STAN and EUKLEMS output often due to differences in vintage / revision of underlying SNA data. But, for detail, also due to exploitation of micro-data sources by EUKLEMS consortium members in certain countries (?) � data that are out of reach for STAN. STAN and EU KLEMS complementary but convergence desirable.

9. STAN next steps Improved documentation New countries in STAN New OECD members (Chile, Estonia, Israel, Slovenia) OECD Enhanced Engagement Countries (Brazil, China, India, Indonesia and South Africa) + other G20? Implementation of ISIC Rev. 4 (NACE Rev.2) Also note: SNA08 (e.g. capitalisation of R&D) Develop closer operational links with EU KLEMS project (and World KLEMS?) particularly given forthcoming upheaval due to ISIC Rev. 4 Documentation. Old version = industry list; variable list + definitions (SNA based); description of underlying sources; STAN family; update process; recent changes in sources and definitions; Recommended uses and limitations; examples of indicators. New version: Add more background (origin and evolution of STAN) ? and summarise changes in national SNA and SBS methodologies over the years? Possible title �STAN 2000-2012, the ISIC Rev. 3 Years� c.f. WORLD KLEMS Documentation. Old version = industry list; variable list + definitions (SNA based); description of underlying sources; STAN family; update process; recent changes in sources and definitions; Recommended uses and limitations; examples of indicators. New version: Add more background (origin and evolution of STAN) ? and summarise changes in national SNA and SBS methodologies over the years? Possible title �STAN 2000-2012, the ISIC Rev. 3 Years� c.f. WORLD KLEMS

10. ISIC Rev. 4 Published by UNSD in August 2008 Closer to NAICS than ISIC Rev. 3 EU countries adopting the related NACE Rev.2 Some other countries using derivatives (e.g. ANZSIC) Implementation at OECD driven by provision of NACE Rev 2. data by EU countries. SNA data according to NACE Rev.2 not expected before end-2011 � for many countries only from year 2000 and with limited industry detail EU Structural Business Statistics already published according to NACE Rev.2 (for 2008 only) ISIC Rev. 4 � implementation will occupy us for next 4 to 5 years OECD involved in its development. This is good news � EU countries have re-calibrated their business registers to NACE Rev. 2. Some others introducing revisions of national classifications e.g. Japan? Could convert NAICS based data to ISIC Rev. 4 relatively quickly but 2/3 OECD = EU countries � � in the first instance, EU countries will provide SNA by activity (A*38 list? ) data from 2000 onwards i.e. limited coverage - c.f. initial and subsequent provision of NACE Rev.1 SNA data Maximum SNA industry list = �A*68� i.e. not full �A*88� 2-digit activity list. May be problematic (e.g. A*68 does not include a breakdown for Mining). Implications for provision of volumes and prices � compared to ISIC Rev.3. First data available from 2012 (although first OECD official SNA08 / ISIC Rev.4 questionnaire in 2014) SBS data for 2008 not yet available in NACE Rev.1 database though � no dual coding for 2008 ? ISIC Rev. 4 � implementation will occupy us for next 4 to 5 years OECD involved in its development. This is good news � EU countries have re-calibrated their business registers to NACE Rev. 2. Some others introducing revisions of national classifications e.g. Japan? Could convert NAICS based data to ISIC Rev. 4 relatively quickly but 2/3 OECD = EU countries � � in the first instance, EU countries will provide SNA by activity (A*38 list? ) data from 2000 onwards i.e. limited coverage - c.f. initial and subsequent provision of NACE Rev.1 SNA data Maximum SNA industry list = �A*68� i.e. not full �A*88� 2-digit activity list. May be problematic (e.g. A*68 does not include a breakdown for Mining). Implications for provision of volumes and prices � compared to ISIC Rev.3. First data available from 2012 (although first OECD official SNA08 / ISIC Rev.4 questionnaire in 2014) SBS data for 2008 not yet available in NACE Rev.1 database though � no dual coding for 2008 ?

11. ISIC Rev. 4 � what we need New industry list(s) for STAN data sets (and EU KLEMS) Conversion tables from National SICs to ISIC Rev.4 ISIC Rev.4 to ISIC Rev.3 conversion key (transition period) ISIC Rev.3 to ISIC Rev.4 conversion key (historic data) Definition of special industry aggregates (e.g. High Tech. manufactures) HS to ISIC Rev.4 conversion for trade data (BTD) Minimum spread of first releases of OECD ISIC Rev. 4 data sets This will not be easy: Note that ISIC Rev.3 released in 1990, SNA 1993, but first STAN ISIC Rev.3 tables in 2000 Compatible lists across STAN�ind, BTD, ANBERD and I-O. Taking into account SNA A* lists, plus specific aggregates to best exploit ISIC Rev.3 and ISIC Rev.2 historical data � For non-EU countries. NACE Rev.2 to ISIC Rev.4 straightforward. Need conversions from NAICS, JSIC, ANZSIC etc. Develop in conjunction with NSOs � and ensure consistency across different data collections (production a/c, emp, gfcf etc) which may have different levels of industry detail� Will need to convert back to ISIC Rev.3 for STAN � particularly SBS when National Accounts are still in NACE Rev. 1. Also (EU) countries will move at different paces - convert back to ISIC Rev.3 while awaiting a �critical mass� of countries. Published concordance tables are many-to-many. We need many-to-one, so compromises will be necessary. First releases of NACE Rev.2 data for limited number of years (from 2000). Added value of STAN is estimating long time series. Therefore may need to convert vintage data to ISIC Rev.4 � Also, note that UNSD intend to develop an ISIC Rev. 2 to Rev. 4 correlation as some (non-OECD) countries still use the older classification. Eurostat have already developed NACE Rev.2 definitions of high and M-H manuf. and Knowledge intensive services. Basically, transposing NACE Rev. 1 definitions and modifying � Ideally should be based on empirical evidence (e.g R&D intensities) but a compromise until ISIC Rev.4 data available. An �official� ISIC Rev. 4 list for ICT already developed. From HS 1988 for long time series? Ensure minimum delays between releasing ISIC Rev.4 STAN tables and those for ANBERD, BTD etc. Also, OECD for FDI, AMNE, SNA, SBS, LFS� Ensure common conversion keys applied? Common release period? Common dissemination tools? Hopefully the time lag will be shorter this time �.. Compatible lists across STAN�ind, BTD, ANBERD and I-O. Taking into account SNA A* lists, plus specific aggregates to best exploit ISIC Rev.3 and ISIC Rev.2 historical data � For non-EU countries. NACE Rev.2 to ISIC Rev.4 straightforward. Need conversions from NAICS, JSIC, ANZSIC etc. Develop in conjunction with NSOs � and ensure consistency across different data collections (production a/c, emp, gfcf etc) which may have different levels of industry detail� Will need to convert back to ISIC Rev.3 for STAN � particularly SBS when National Accounts are still in NACE Rev. 1. Also (EU) countries will move at different paces - convert back to ISIC Rev.3 while awaiting a �critical mass� of countries. Published concordance tables are many-to-many. We need many-to-one, so compromises will be necessary. First releases of NACE Rev.2 data for limited number of years (from 2000). Added value of STAN is estimating long time series. Therefore may need to convert vintage data to ISIC Rev.4 � Also, note that UNSD intend to develop an ISIC Rev. 2 to Rev. 4 correlation as some (non-OECD) countries still use the older classification. Eurostat have already developed NACE Rev.2 definitions of high and M-H manuf. and Knowledge intensive services. Basically, transposing NACE Rev. 1 definitions and modifying � Ideally should be based on empirical evidence (e.g R&D intensities) but a compromise until ISIC Rev.4 data available. An �official� ISIC Rev. 4 list for ICT already developed. From HS 1988 for long time series? Ensure minimum delays between releasing ISIC Rev.4 STAN tables and those for ANBERD, BTD etc. Also, OECD for FDI, AMNE, SNA, SBS, LFS� Ensure common conversion keys applied? Common release period? Common dissemination tools? Hopefully the time lag will be shorter this time �..

12. OECD�s general role International Standards � SNA, ISIC etc. Related methodology e.g. SNA08: measurement of R&D investment (c.f. software under SNA93) Guiding implementation � not only in OECD countries e.g. OECD/China SNA program Strong links with NSOs, Ministries, policy makers Dialogue � various Working Parties First line of data quality control Vintage / archived data sets (for OECD countries) Significant involvement (with UN, EC and other intl orgs) in development of intl. standards + measurement of capital stock and productivity. SNA manuals don�t always go into detail on how to produce the statistics. E.g. methods for estimating investment in software agreed long after publication of SNA93 SNA questionnaire to be sent to major non-OECD countries (BRIICS) for consultation and voluntary completion � and wide networks of researchers and assorted experts worldwide Regular Working Party meetings on SNA, Industrial Statistics, Globalisation and trade etc. Bringing together national (government) experts and those from research community. + assorted themed Workshops E.g. We get SNA by activity data for STAN quite quickly. I always assume NSIs can make mistakes and thus try to ensure thorough checking a.s.a.p. so that any anomalies can be communicated to NSIs before anyone else notices � Some NSIs no longer have, or don�t wish to release, vintage data sets based on old standards and methodologies Significant involvement (with UN, EC and other intl orgs) in development of intl. standards + measurement of capital stock and productivity. SNA manuals don�t always go into detail on how to produce the statistics. E.g. methods for estimating investment in software agreed long after publication of SNA93 SNA questionnaire to be sent to major non-OECD countries (BRIICS) for consultation and voluntary completion � and wide networks of researchers and assorted experts worldwide Regular Working Party meetings on SNA, Industrial Statistics, Globalisation and trade etc. Bringing together national (government) experts and those from research community. + assorted themed Workshops E.g. We get SNA by activity data for STAN quite quickly. I always assume NSIs can make mistakes and thus try to ensure thorough checking a.s.a.p. so that any anomalies can be communicated to NSIs before anyone else notices � Some NSIs no longer have, or don�t wish to release, vintage data sets based on old standards and methodologies

13. Final messages Compiling internationally comparable databases, such as STAN and EU KLEMS, is hard work but of immense value to economic researchers worldwide It�s during times of major changes in classification and methodology, when there is limited coverage for official statistics, that such databases are most needed (c.f. ISIC Rev.2. ? Rev.3 / SNA68 ? SNA93) � � but most difficult to produce as longer time-series have to be imputed Advocate strong links between OECD and EU KLEMS / World KLEMS As I�m sure those who work(ed) on EU KLEMS can testify. Introducing new countries is non-trivial too � Often with approximate conversion keys (e.g. ISIC Rev. 2 ? ISIC Rev. 3) As I�m sure those who work(ed) on EU KLEMS can testify. Introducing new countries is non-trivial too � Often with approximate conversion keys (e.g. ISIC Rev. 2 ? ISIC Rev. 3)