I. Main Contents
Data on price indices in this chapter show the changing trends and the change rates in the prices of production, trade, consumption and investment, including mainly consumer price indices, retail price indices, price indices for means of agricultural production, producer price indices for farm products, producer price indices for industrial products, purchasing price indices for industrial producers, price indices for investment in fixed assets, and price indices for imports and exports.
II. Sources of Data
Compilation of statistics on price indices is organized by the Department of Urban Social and Economic Survey, NBS and the Department of Rural Social and Economic Survey, NBS. The urban socio-economic survey organizations of the provinces, autonomous regions and municipalities directly under the Central Government and of the selected cities and counties collect data from the grassroots units in accordance with the scheme of price survey system stipulated by the NBS, tabulate them and report them to the higher agencies.
III. Consumer Price Indices and Retail Price Indices
Data for compilation of the consumer price indices and the retail price indices in China are collected through a combination of sample surveys and surveys of key units. Areas distributed in different economic regions are selected as the sample areas and representative commodities are selected as the sample commodities. Regular surveys are conducted to collect data on their market prices. Population parameters are inferred on the basis of the sample data. At present, 500 cities and counties have been selected for this purpose. Following are major steps in the process of calculation of the price indices:
(1) The selection of areas and survey points: Based on such principles as regional economic features and reasonable geographic distribution, representative sample areas for the national survey are selected which include large, medium and small cities and counties. When the sample areas have been selected, large-scale shops and markets (including fairs and service outlets) with wide variety of commodities are selected as survey points.
(2) The selection of representative commodities and their specifications or varieties: The representative commodities selected are those consumed in large quantity and representative in price changes. The representative specifications or varieties are determined according to the data on the retail sales of commodities and the consumption expenditure account data of urban and rural residents; and selection follows the related instructions. The principles for selection are: (a) The commodities are closely related to social production and people’s living conditions; (b) They are consumes (or sold) in large quantities (or large values); (c) The market supply is stable; (d) The changes of their prices are representative in trend; (e) There is great heterogeneity among the specifications or varieties selected.
At present, data are collected on over 600 specifications each month under 262 basic headings in 8 categories in the consumer price surveys. For the retail price surveys, data are collected on more than 500 specifications each month under 229 basic headings in 16 categories.
(3) Method of data collection: Enumerators are sent to the survey points to take the records of the prices. Nearly 10 thousand assistant enumerators are recruited to assist the survey work.
(4) Determination of the weights: The weights of the retail price indices are determined mainly according to the total retail sales of commodities. The weights of the consumer price indices are determined according to the composition of the consumption expenditures of urban and rural households.
IV. Producer Price Indices for Industrial Products
Producer prices for industrial products refer to the ex-factory price of manufactured goods when they are first sold. The survey program is a combined use of the key units’ survey and typical units’ survey methods. Key units refer to those industrial enterprises with annual revenue from the primary activities at and above 20 million yuan. Typical units refer to the industrial enterprises with annual revenue from the primary activities below 20 million yuan.
(1) Principles for selecting the representative enterprises: (a) Enterprises to be covered in the survey are selected by industrial sectors. In principle, every branch should have enterprises selected; (b) All (or a majority of) large-scaled enterprises should be selected; (c) Enterprises selected should be those with normal and stable production.
(2) Principle for the selection of representative goods:
(a) The goods are selected by industrial sectors; (b) The selected goods should have great impact on the national economy and people’s living conditions; (c) The production of the goods selected are relatively more stable; (d) The prospects of the goods selected are promising; (e) The goods selected are representative to the localities.
The survey catalog of Producer Prices for Industrial Products includes over 11,000 goods, and they are divided into 1702 basic classification; Survey catalog of Purchasing Price for Industrial Producers includes over 6000 goods, and they are divided into over 900 basic classifications.
(3) Method of data collection: The method of reporting forms by enterprises is adopted. There are about 60,000 industrial enterprises which should report the price data every month.
(4) Determination of the weights: In statistics of producer price indices for industrial products, the weight of industrial small classification and above comes from the output value of industrial sales by sector in industrial statistics; the weight of basic headings of categories comes from weight survey of independent industrial enterprise products. The weights are replaced every five years.
V. Price Indices for Investment in Fixed Assets
Data on prices of investment in fixed assets are collected by a program involving the combined use of surveys on key units and surveys on typical units. The prices collected in the surveys of investment in fixed assets are the actual purchasing prices or settlement prices of entities of investment in fixed assets. The survey content includes the prices of main construction materials that constitute the architectural engineering entity in the year, such as steel, timber, cement, local construction materials (such as brick, tile, calcareous ashes, sand, stone, etc.), chemical materials (such as oil paint, etc.), the price of labor force as input (wages), prices for renting of building machinery and equipment, the purchasing price of equipment, tools and instruments and the prices of others investments.
The following principles should be followed in selecting the sample for the price survey of investment in fixed assets:
(1) Principles for selecting the survey points of construction and installation: (a) Sample units should have a good coverage; (b) The economic activity of investment should have strong representativeness; (c) Different types of registration should be considered; (d) Key projects should be selected; (e) Attention should be given to various sectors of the national economy and types of projects.
(2) Principles for selecting price survey points of other fees: The principles for selecting survey points of others fees is in general the same as that of construction and installation, with special attention being paid to selecting projects with huge investment value. Since it is not easy to obtain the other fees, during the actual data gathering operations, survey on key construction owner units and building units is to conducted concurrently with survey on typical units (with information from administration units)
(3) Method of price survey: A combination of enterprises reporting system and enumerator visits method.
(4) Determination of the weights: The weights for calculation of the price indices for investment in fixed assets are determined according to the average proportion of construction and installation, purchase of equipment, tools and instruments and other investments in the 3 preceding years.
VI. Price Index for Farm Products
Price Index for Farm Products refers to the actual price per unit through directly selling their products by producers of farm products. The survey program of Price Index for Farm Products is a combined use of sampling survey and typical units’ survey. It covers main farm products produced and sold by the units surveyed. Representative farm products include those in Agriculture, Forestry, Animal Husbandry and Fishery, 90% of small classification in medium-sized classification. The products are generally with large production and sales, having great impact on the national economy and people’s living conditions, with strong stability, with promising to new products and with local characters. Representative products are for 5 years. The survey is conducted quarterly.
VII. Price Indices for Imports and Exports
Price Indices for Imports and Exports is compiled by the General Administration of Customs with the unit value method on the basis of the statistics of imports and exports of goods. The import price indices is estimated with c.i.f. prices while the export price indices with f.o.b. prices. Based on detailed records of imports and exports of goods, the Customs estimates the coefficients of variation of the prices of the same commodity group, selects a sample of commodities at the 8-digit level of the Harmonized Commodity Description and Coding System with a coverage of over 70%. The price indices is compiled on a monthly basis.