Ruth Meier, Director, Economy, State and Social Issues SFSO October 16th, 2006

1. OECD Workshop on ProductivityMulti-factor productivity measurement: From data pitfalls to problem solving – the Swiss way Ruth Meier, Director, Economy, State and Social Issues SFSOOctober 16th, 2006

2. Presentation • Institutional framework and constraints • From the production process … • … through the maze of specific issues.. • … up to first results • Conclusion

3. Presentation • Institutional framework and constraints • From the production process … • … through the maze of specific issues.. • … up to first results • Conclusion

4. Additional surveys: neither wishful nor really useful National Accounts OECD manuals Institutional framework and constraints Constraint 1 Flexible accounting framework  Heterogeneous information Constraint 2 Unquoted enterprises:lack of regulation/information Constraint 3 Limit statistical burden on enterprises Constraint 4 International comparability:- central concern

5. Presentation • Institutional framework and constraints • From the production process … • … through the maze of specific issues.. • … up to first results • Conclusion

6. Full-time equivalents Hours worked Standard efficiencyunits Total factor inputs Capital services Gross fixed capital formation Labor input User Costs Capital stock Assetprice Depreciation Holding gains/ losses Interestrate Gross Domestic Product (GDP) Multi-factor productivity Production process Age-efficiency profileAge-price profilevia geometric function Index PIM Depreciation Cost share of capital input Cost share of labor input

7. Presentation • Institutional framework and constraints • From the production process … • … through the maze of specific issues.. • … up to first results • Conclusion

8. Hours worked Standard efficiencyunits Total factor inputs Capital services Gross fixed capital formation Labor services User Costs Capital stock Gross Domestic Product (GDP) Multi-factor productivity Specific issues:

9. Hours worked • Two issues: • Lifetimes of assets  National Accounts • Back–calculations  GDP / Historical series of National AccountsCriteria: Coherent and transparent treatment Standard efficiencyunits Total factor inputs Capital services Gross fixed capital formation Labor services User Costs Gross Domestic Product (GDP) Multi-factor productivity Specific issues: Capital stock Capital stock

10. Hours worked Standard efficiencyunits Total factor inputs Capital services Gross fixed capital formation Labor services Assetprice Depreciation Holding gains/ losses Interestrate Gross Domestic Product (GDP) Multi-factor productivity Specific issues: User Costs User Costs Capital stock Endogenous Exogenous Switzerland: Average

11. Hours worked Standard efficiencyunits Total factor inputs Capital services Gross fixed capital formation Labor services Assetprice Depreciation Holding gains/ losses Interestrate Gross Domestic Product (GDP) Multi-factor productivity Specific issues: User Costs User Costs Capital stock - Relative volatility of prices- Potentially negative user costs- Fitted Values used in Switzerland

12. Presentation • Institutional framework and constraints • From the production process … • … through the maze of specific issues.. • … up to first results • Conclusion

13. Main results for Switzerland:

14. Main results for Switzerland: Capital stock components

15. Main results for Switzerland: GDP growth decomposed

16. Main results: International comparisons (1)

17. Main results: International comparisons (2)

18. Presentation • Institutional framework and constraints • From the production process … • … through the maze of specific issues.. • … up to first results • Conclusion

19. Conclusion Methodology sound, but… … data shortcomings may impact on results •  consolidation required • … new analytical framework and major additional inputs for political debate Asset lifetimes Interest rates Etc…