Behind the Numbers U.S. Trade in the World Economy (1992) / Chapter Skim
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Summary of Major Conclusions and Recommendations
Summary of Major Conclusions and Recommendations
Pages 1-18
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From page 1... ...
Although various federal agencies in recent years have made significant efforts to improve the data, the increasingly complex nature of international economic activities has complicated their tasks, and major shortcomings remain. To assist public and private decision makers, who increasingly face new economic policy issues and unprecedentecl business opportunities in a competitive world economic environment, federal statistical agencies must set priorities as they seek to upgrade existing data systems.
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economy. SUPPLEMENTING THE EXISTING STATISTICAL FRAMEWORK AND INTEGRATING DISPARATE DATA SETS Two major economic forces have been shaping the international trading environment over the past several decades: rapid technological changes and the liberalization and deregulation of domestic and international markets.
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Businesses increasingly have to weigh the opportunities of selling at home and abroad; evaluate the cost-effectiveness of producing domestically and overseas; and consider the merits of engaging in various collaborative activities with foreign counterparts to maximize market opportunities. The new economic policy issues arising from the growing interdependence of national economies and increasingly complex commercial relations of business enterprises call for a broadened statistical framework that relates explicitly to the emerging international tracing environment.
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COMPARABLE DATA As domestic and international economic activities are increasingly linked, improving the comparability of domestic production and other economic data with data on international economic activities will enhance the analytical usefulness of existing data. Moreover, as the world economy becomes increasingly interdepenclent, international economic activities will require more comparable economic data across countries.
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RECOMMENDATIONS Recommendation 1-1 A supplemental statistical framework that integrates balance-of-payments data and data on affiliates' operations at home and abroad should be developed to better reflect the link between trade and foreign direct investment.
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input-output tables. Recommendation 2-3 Data at the four-digit SIC industry level, compiled in most cases on a four-digit SIC product basis, should be collected not only on the domestic production of goods, but also on the domestic production of services, the production of goods and services by foreign affiliates, and foreign direct investment so that data on international trade in goods and services can be related to these data.
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international trade and financial statistics. MERCHANDISE TRADE Enhanced coordination between the Customs Service and the Census Bureau and a substantial rise in electronic filing of import data have significantly reduced processing delays and Towered carryovers on merchandise trade data in recent years.
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INTERNATIONAL SERVICES TRANSACTIONS Primarily by improving surveys on travel and adding new surveys on education and selected business, professional, and technical services for 1985-1987, Bureau of Economic Analysis (BEA) in 1989 uncovered an additional $20 billion of net receipts of U.S.
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are substantially underreported or simply not represented at all, and the total value of such omitted transactions may be substantial. CAPITAL Flows One recent development that will improve the quality of clirect investment data is the enactment of the Foreign Direct Investment and International Financial Data Improvement Act of 1990.
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RECOMMENDATIONS Merchandise Trade Recommendation 4-1 The Customs Service and the Census Bureau should strengthen their enforcement efforts to assure accurate and timely reporting of exports to correct the problem of export underreporting. The Census Bureau should no longer allow carriers to report exports as late as 4 days after departures of shipments.
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The quality measures should permit overall estimates of the quality of the published merchandise trade data and estimates of the quality of specific key processes, such as data collection, coding, editing, imputation, error correction, and revision procedures. Recommendation 4-3 The Census Bureau and the Customs Service should work closely with data filers to evaluate and improve the quality of the incoming trade data.
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The Census Bureau should initiate a joint effort with other appropriate agencies to develop a simplified universal electronic shipping and trade document. Recommendation 4-11 The Census Bureau and the Bureau of Economic Analysis should consider initiating a substantial multiyear effort to develop and test concepts, content, design, and procedures for surveys to collect integrated merchandise and services trade data from establishments.
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F] ows Recommendation 6-1 Because the existing system for collecting data on international portfolio transactions was developed before the advent of modern electronic and telecommunications technology currently used by growing numbers of transactors, research is needed to explore alternative methods of data collection.
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To best accomplish the task, data collection agencies must understand the basic purposes of the data and build appropriate concepts and definitions into the design and development of the statistical framework. To ensure that the data collected are suitable for the purposes intended, statistical agencies must also be able to analyze and interpret them.
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seasonal movements as well or better than current methods and reduce the volatility of the monthly trade balance data. The monthly merchandise trade statistics also lack a long-term orientation, [Limiting their usefulness for policy analysis and re
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international economic activities. The Census Bureau and.the Bureau of Economic Analysis should work jointly to develop concepts, definitions, measures, and strategies for capturing in more detail the rapidly growing intracompany trade and trade in intermediate inputs.
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In particular, attention should be given to establishing normally acceptable ranges for the fluctuations displayed in monthly trade balance figures. In addition, the Census Bureau should assess the feasibility of applying alternative seasonal adjustment procedures to produce data more indicative of underlying trends.
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