The Compilation And Reference Of UK Services Producer Price Index (SPPI)

Service industry has become more and more important in the national economy with its rapid progress since the Reform and Opening-up. The changes of services producer price have a big impact on the development of relevant industries and enterprises, even the operation of the national economy, which makes the demand of producer price statistics for services more and more urgent. The Services Producer Price Index (SPPI) provides information on price change for service businesses services. At present our country has only started to compile an experimental SPPI for telecommunication, and it has not formed a complete index system. In contrast, the compilation of UK’s SPPI began earlier, its compilation method and statistical techniques already tend to mature. So the study of the compilation method of UK’s SPPI can give some theoretical guidance and experience reference, and this is of importantly theoretical and practical significance in many aspects, for example, the upgrading service statistical methods, improving the quality of National Economic Accounting, and enhancing the macro-control.The purposes of this paper are reviewing the development history of UK’s SPPI, systematically researching the theoretical foundation and specific procedures of its compilation, on this basis, trying to explore the path choice of compiling China’s SPPI combined with the situation of our country.This paper is divided into five chapters, as follows:Chapter1is introduction. Firstly, this chapter discusses the concept and main users of UK’s SPPI, and then states its research significance compared with the backwardness of our own service price statistics. Secondly, by summarizing the research progress of some international organizations and developed countries, as well as the internal researchers’ relevant articles, it demonstrates that China’s SPPI is just at the beginning stage, the academia and statistics department gradually realize the necessity of perfecting Services Producer Price Index system. Finally, the paper is structured, innovative content and the lack of. Chapter2reviews the development history of UK’s SPPI. From the beginning that the Office for National Statistics established a dedicated team to take forward development of service sector prices in1995, the development history of UK’s SPPI can be divided into three stages:the beginning stage (1995-2000), the developing stage (2001-2005) and the perfecting stage (2006up to now). Meanwhile conclusions about each stage’s main results including improving the coverage, compilation method and quality of the index are summarized.Chapter3focuses on the compilation method of UK’s SPPI. Firstly the chapter gives the theoretical basis for compiling UK’s SPPI, introducing the scope and structure of the index. Then a detail study is made on compiling procedure of UK’s SPPI:(1) Sample design. The sample covers Great Britain and is selected from the ONS Inter-departmental Business Register using a fixed panel design, initially selected using stratified random sampling by employment size band and industry.(2) Service price and price collection. The main pricing methods for UK’s SPPI include direct use of prices of repeated services, unit value method, component pricing method, percentage fee method, model pricing and time-based method. ONS collects prices mainly via posting questionnaires.(3) Weighting and estimation. The weights used in the SPPI system are based on the SPPI Turnover Survey carried out every five years.(4) Data processing and quality adjustment. Methods that can be used for dealing with quality of services during compiling UK’s SPPI are as follows:overlap, comparable replacement, quantity adjustment, differences in production costs, hedonic approach.(5) Calculating indices based on fix-weighted Laspeyres formula.(6) Publishing SPPI series.Chapter4takes the business telecommunications SPPI and banking SPPI for example, and summarizes the practice experience of UK’s SPPI. In the section of business telecommunications SPPI, it mainly analyzes the reform of business telecommunication services structure and compares the pricing methods for telecommunication services. In the section of banking SPPI, it introduces the statistical scope, pricing methods for financial intermediation services and the computing method of UK’s banking SPPI. At last, considered the current situation of China’s business telecommunications and banking, successful experience for reference is summarized.Chapter5discusses the problems of compiling China’s SPPI. This chapter designs the structure of China’s SPPI, makes the plan of collecting data, gives the specific procedures and compilation methods of China’s SPPI via the reference of UK’s SPPI. It analyzes the difficulties may encounter in the compiling process and puts forward proposals to solve them. Finally, the development of China’s SPPI is forecasted.Because the internal study and practice about SPPI is just in the beginning stage, no further information for UK’s SPPI is available, this paper systematically researches the compilation method of UK’s on the base of the achievement made by ONS and some international organizations, and tries to explore the path choice of compiling China’s SPPI combined with the situation of our country. The innovation of this paper:in China, firstly study the concept, use and scope of UK’s SPPI; reviewing the development history of UK’s SPPI by stages; introducing the specific procedures of compiling UK’s SPPI, concluding the methods of services pricing and quality adjustment; researching the compilation practice of UK’s business telecommunications SPPI and banking SPPI, and summarizing the reference for our country; designing the structure of China’s SPPI; making the plan of collecting data; giving the specific procedures and compilation methods of China’s SPPI; analyzing the difficulties may encounter in the compiling process and putting forward proposals.Due to the constraints of insufficient information, the study time and personal capacity, some service industries may be omitted in the China’s SPPI framework this paper designs, and a detail index structure remains to be further studied.