Research On National Annual Average Price Computation And Spatial Adjustment Method

When implenting International Comparison Program,the price used is not the data at a certain point, but the average price in the whole year along the whole country.Normally,we use the national average prices to reflex the average level of purchasing power parities.Calculation of national average prices is carried out along two perpendicular dimensions:space and time. Spatial averaging is aligned with the geographical stratification of price surveys, whereas temporal averaging reflects the survey schedule. Both averaging processes are carried out in keeping with the quarterly and annual sequencing of data validation, submission, and processingSimilar to countries participating in the Eurosta and OECD comparisons,China participated in the ICP 2011 with data collections of only two or three cities in one province.As the regional economic development is not balanced, the consumption pattern of the residents is different, there is a big difference between the cities of the provinces of China,and the urban and rural areas.Therefore using the average price of two or three cities in a province to represent the provincial price level or using the simple arithmetic average price of the 30 provinces to represent the national price level can bring a huge deviation.As a result,research on spatial ajusting method can be a reference to China.Under this circumstance,this paper focuses on Operational Guidelines and Procedures for Measuring the Real Size of the World Economy, ICP2011and Eurostat-OECD Methodological Manual on Purchasing Power Parities.Firstly, the basic content of the national average price is introduced, including basic concepts, basic implenting process and calculation method.Secondly, this thesis describes the improvement of the ECP countries in the national average price calculation method in detail,which is the spatial adjustment fators and the temporal adjustment factors.During the process of the research on the calculation methods, the CPI data is used all along through the PPP calculation. Therefore, the possibility of integration of ICP and CPI is studied, and the method to increase the contact of the two in the future is suggested. Finally this paper draws the conclusion, and analyzes the applicability of ECP spatial adjustment method in China, and puts forward the suggestion.Content and structure of this article is organized as follows:The first chapter is introduction, including the research background,research significance,research status, the structure of this paper and innovation.The second chapter mainly puts forward the the concept, function and importance,the general process,the calculation method of the national average price, and give some concrete calculation examples,as well as showing some special cases of computation.The third chapter analyzes tthe calculation method of the temporary adjustment factor s and the the temporal adjustment factor which is used to eliminate the effect of the time dimension in ECP countries.The fourth chapter is about the national average price calculation method, from the regional classification, weight selection, calculation method in the ECP space adjustment method in China, and analysis of the applicability of the need to pay attention to the problem.The fifth chapter is the improvement of the national average price calculation method, the research found that the data quality of CPI data is always, and the quality of the data is the result of the international comparison. This chapter analyzes the relationship between CPI and purchasing power parity, and puts forward a method to make full use of consumer price data.The sixth chapter draws the conclusion, and analyzes the applicability of ECP spatial adjustment method in China, and puts forward the suggestion.The conclusions of this paper are as follows:Firstly,the spatial adjustment factors can be calculated on the basis of available CPI data or they can be derived from specific surveys aiming at measuring regional differences in consumer price levels.Secondly,If regional average prices have been computed, the calculation of the spatial adjustment factors can proceed in the same way as PPPs are calculated at European level-that is, using the EKS method, including the assignment of representativity indicators at regional level. This would yield regional PPPs. If the regional PPPs are expressed with country=1, the spatial adjustment factor would be the inverse of the PPP for the capital region. It is not necessary to calculate regional PPPs though. It is also possible to calculate national average prices and capital city average prices and take the unweighted geometric mean of the ratios between the two. This gives the spatial adjustment factor for the basic heading directly.Thirdly,seasonal products are defined as those products for which both prices and the quantities sold vary considerably throughout the year. Typically, the patterns of variation are repeated from one year to the next. The approach adopted by Eurostat for seasonal food products is to obtain annual prices by adjusting survey prices with weighted temporal adjustment factors.Fourthly,in the calculation of the adjustment of the national annual average price and price space,China needs to consider the following questions:one is the grading areas, China should strive to provide data on consumption of the rural areas; second, the choice of weight, general use of sales, which requires China to improve and perfect the household consumption survey work, take full advantage of the scan data and other electronic information. Note that in order to ensure the homogeneity of goods, but also should pay attention to the consistency of the sales point of choice.Fifthly, the calculation of the annual average price of ECP countries and spatial adjustment factors needs to use CPI data. As price indicators,PPP and CPI have some similar characters, but they are difficult to coordinate in some aspects. Research on the integretion of CPI and PPP can provide a wider range of effective data, save costs, build regional PPP, etc.. The connection of ICP and CPI can be strengthened from the following four aspects:the expansion of CPI product range, the use of CPI to estimate the PPP of non reference year, the use of CPI to build regional PPP, the use of scanning data.The innovation of this paper is that:at present, there is little research on the spatial price index in China, and the spatial adjustment factor used by ECP is actually an index of spatial price. Through the study of ICP and ECP mannuals, this paper finds that the specific calculation method of the average price of ECP countries, including the missing value processing method and the establishment of space adjustment factors; when studying the relationship between the CPI and ICP,this paper analyzes not only in the theoretical way but also in the pratical way, and according to the requirements of the ICP practice,put forward the method to strengthen the connection of the two price indicators.The problem of this paper is that this paper can’t caculate chinese data because of the missing data resource.