Gross state product by industry, 1977-89.
Trott, Edward A., Jr. ; Dunbar, Ann E. ; Friedenberg, Howard L. 等
THIS article presents new current-dollar estimates of gross state
product (GSP) by industry and by component for States and regions for
1987-89 and revised estimates for 1977-86 (see tables 4 and 5, which
follow the text). These estimates update and extend those published in
the May 1988 SURVERY OF CURRENT BUSINESS. (1) Revisions from the
previously published estimates for 1977, 1982, and 1986 are shown in
table 6. The estimates for 1977-89 are consistent with the revised
estimates of gross product by industry for the Nation that were
published in the January 1991 and April 1991 issues of the SURVEY. (2)
GSP is the market value of the goods and services produced by labor
and property located in a State. It is the State counterpart of the
Nation's gross domestic product (GDP) from the national income and
product accounts (NIPA's).
BEA prepares GSP estimates for 61 industries (table 1). For each
industry, GSP is composed of four components: (1) Compensation of
employees (hereafter termed "compensation"); (2)
proprietors' income with inventory valuation adjustment and capital
consumption allowances ("proprietors' income"); (3)
indirect business tax and nontax liability ("IBT"); and (4)
other, mainly capital-related, charges ("capital charges").
For the farming, mining, construction, and manufacturing industries, BEA
estimates total GSP and three of its four components--compensation,
proprietors' income, and IBT--and then it subtracts the three
components from total GSP to get capital charges. For the other
industries, BEA estimates each of the four components of GSP and then
sums the components to get total GSP.
Most of the compensation and proprietors' income components of
GSP are primarily based on BEA's estimates of earnings by place of
work, an aggregate in the State personal income series. (Table 2 shows
in detail how GSP corresponds to earnings and GDP.) The capital charges
component of GSP reflects capital stocks and profits by State. The IBT
component reflects liabilities charged to business expense, most of
which are sales and property taxes levied by State and local
governments. (3)
The next section of this article discusses the source data and
estimating methods for the GSP series. The final section discusses the
impact of the revisions on regional growth trends from 1977 to 1986 and
the growth trends during 1986-89.
Sources and Methods
The sources and methods underlying the estimates are similar to
those discussed in the May 1988 SURVEY article. (4) One new element is
the application of benchmark-year estimation methods to all years for
two components: Capital charges for government enterprises--that is,
subsidies less current surplus of government enterprises--and IBT. (5)
Previously, the estimates of subsidies less current surplus for all
nonbenchmark years and the estimates of IBT for 1978-81 and 1986 were
interpolated or extrapolated on the basis of movements in related
series. For all years, the estimates of subsidies less
Table 1.--Industries for Which GSP Estimates
Are Available
1972 SIC
code
Agriculture, forestry, and fisheries A
Farms 01-02
Agricultural services, forestry, and fisheries 07-09
Mining B
Metal mining 10
Coal mining 11-12
Oil and gas extraction 13
Nonmetallic minerals, except fuels 14
Construction C
Manufacturing D
Durable goods
Lumber and wood products 24
Furniture and fixtures 25
Stone, clay, and glass products 32
Primary metal industries 33
Fabricated metal products 34
Machinery, except electrical 35
Electric and electronic equipment 36
Motor vehicles and equipment 371
Transportation equipment excluding motor vehicles 372-79
Instruments and related products 38
Miscellaneous manufacturing industries 39
Nondurable goods
Food and kindred products 20
Tobacco manufactures 21
Textile mill products 22
Apparel and other textile products 23
Paper and allied products 26
Printing and publishing 27
Chemicals and allied products 28
Petroleum and coal products 29
Rubber and miscellaneous plastic products 30
Leather and leather products 31
Transportation and public utilities E
Railroad transportation 40
Local and interurban passenger transit 41
Trucking and warehousing 42
Water transportation 44
Transportation by air 45
Pipelines, except natural gas 46
Transportation services 47
Communications 48
Electric, gas, and sanitary services 49
Wholesale trade F
Retail trade G
Finance, insurances, adn real estate H
Banking 60
Credit agencies other than banks 61
Holding companies and investment services 62,67
Insurance carriers 63
Insurance agents, brokers, and services 64
Real estate 65-66
Services I
Hotels and other lodging places 70
Personal services 72
Business services 73
Auto repair services and garages 75
Miscellaneous repair services 76
Motion pictures 78
Amusement and recreation services 79
Health services 80
Legal services 81
Educational services 82
Social services and membership organizations 83.86
Miscellaneous professional services 84.89
Private households 88
Government
Federal civilian government
Federal military government
State and local government 91-96
current surplus now are based on data for individual enterprises.
For all years, the IBT estimates now are based on data for nearly 50
types of taxes--more than twice as many as for the series published in
1988.
Other new elements are the preparation of annual estimates of the
capital consumption allowance in proprietors' income and of
improved estimates of the rental-income-of-persons portion of capital
charges for the real estate industry.
The effect of the new elements is to increase from 70 percent to 80
percent the portion of total GSP for nonbenchmark years that is
estimated directly, that is, through the use of source data for each
year, rather than being interpolated or extrapolated. For benchmark
years, the directly estimated portion of GSP stays at 95 percent.
Compensation and proprietors' income
Annual estimates by State and industry of two components of
compensation--wages and salaries and other labor income--as well as of
proprietors' income with inventory valuation adjustment are from
BEA's State personal income series. (6) Wages and salaries, in
turn, is part of the basis for allocating to States the component of
compensation not measured in the personal income account--employer
contributions for social insurance. For proprietors' income,
unpublished income estimates from the Internal Revenue Service are the
basis for allocating noncorporate capital consumption allowances to
States.
IBT
For all years, IBT estimates are based on the following data on
taxes collected: [1] By State and type of tax, from the census of
governments (for State and local IBT) and from the Internal Revenue
Service (for Federal IBT) and [2] by industry and type of tax, from BEA.
Capital charges
For government enterprises, the sources and methods for estimating
capital charges, or subsidies less current surplus, are the same for all
years. For Federal Government enterprises, BEA uses data for 20
enterprises to allocate subsidies less current surplus to States. For
State and local government
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enterprises, BEA uses data on current revenues and expenses for 15
types of enterprises from the census of governments to allocate
subsidies less current surplus.
For private industries for benchmark years, the sources and methods
for estimating capital charges differ by industry group. For 27
goods-producing industries in agriculture, mining, construction, and
manufacturing, BEA estimates capital charges by first estimating total
GSP and then subtracting compensation, proprietors' income, and
IBT. Economic census data on value added in production, adjusted to
conform to BEA's NIPA definitions, are the basis for estimating
total GSP.
For seven regulated distributive and service industries in
transportation, communication, utilities, and finance, data from
financial reports filed by firms with regulatory agencies are the basis
for estimating capital charges by State. For multistate firms in this
group, BEA employs indicators of capital stock or its use--for example,
airline boardings--to allocate capital charges to States.
For real estate, BEA mainly uses data from the population and
housing censuses and from the U.S. Department of Agriculture to allocate
capital charges to States in accordance with the location of real
property. BEA estimates the rental-income-of-persons portion of capital
charges.
For 23 unregulated distributive and service industries in
transportation, trade, finance, insurance, and services, BEA uses
economic census data on business receipts or sales and data on wages and
salaries to allocate capital charges to States.
For all private industries except farming and real estate for
nonbenchmark years, capital charges are interpolated or extrapolated on
the basis of movements in wages and salaries. For farming, estimates
for all years are based on U.S. Department of Agriculture data. For
real estate, estimates for intercensal years are based on data developed
in the course of estimating the rental income of persons in BEA's
State personal income series.
As resources permit, BEA plans to incorporate data from the Census
Bureau's Annual Survey of Manufactures and other annual data,
particularly those contained in regulatory agency reports, in the
estimates of capital charges for private industries for nonbenchmark
years.
Regional Growth Trends,
1977-89
The trends in regional growth in 1977-86 shown by the revised GSP
estimates are similar to, but more pronounced than, the trends shown by
the previously published estimates: From 1977 to 1986, the share of GSP
generated in the Nation's interior regions declined, and the share
generated in regions along the Atlantic and Pacific coasts increased.
The revisions now show that the share in the interior regions declined
(and that the share in the coastal regions increased) 3.8 percentage
points during 1977-86, compared with 3.2 percentage points before the
revision (table 3). The 1977-86 trends in regional growth in GSP
continued in 1986-89: The share of GSP generated in the interior regions
declined by an additional 1.6 percentage points, and the share generated
in the coastal regions increased by an offsetting amount.
The 0.6-percentage-point revision in the change in share between
coastal and interior regions from 1977 to 1986 largely reflected GSP
revisions in four regions: In the Mideast, as a result of upward
revisions in the gain in share in New Jersey and the District of
Columbia; in the coastal Southeast, an upward revision in the gain in
share in North Carolina; in the Far West, an upward revision in the gain
in share in California; and in the Southwest, upward revisions in the
loss in share in Texas and Oklahoma.
Changes in estimating methods contributed to the revisions in
changes in share in New Jersey, the District of Columbia, and
California. In New Jersey, the upward revision partly reflected the
effect on capital charges for real estate of the improved annual
estimates of rental income of persons. In the District of Columbia, the
upward revision partly reflected the effect on Federal Government
enterprises of the improved estimates of subsidies less current surplus.
In California, the upward revision partly reflected the effects on GSP
for real estate of the new annual estimates of the capital consumption
allowance in proprietors' income and of the improved IBT estimates.
The revised national estimates of GDP by industry contributed to
the revisions in North Carolina, Texas, and Oklahoma. In North
Carolina, the upward revision partly reflected revisions in GDP for
tobacco manufactures; North Carolina is the Nation's leading
tobacco-producing State. In the oil-producing States of Texas and
Oklahoma, revisions in GDP for oil and gas extraction led to an upward
revision in the loss in share of the Nation's all-industry GSP
attributable to these States.
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(1) Vernon Renshaw, Edward A. Trott, Jr., and Howard L.
Friedenberg, "Gross State Product by Industry, 1963-36,"
SURVEY OF CURRENT BUSINESS 68 (May 1988): 30-46. See also "Errata:
Gross State Product," SURVEY 68 (October 1988): 37.
(2) Frank de Leeuw, Michael F. Mohr, and Robert P. Parker,
"Gross Product by Industry, 1977-88: A Progress Report on Improving
the Estimates," SURVEY 71 (January 1991): 23-37; and Michael F.
Mohr, "Gross National Product by Industry, 1987-89," SURVEY 71
(April 1991): 25-27.
(3) Property taxes on owner-occupied housing are included because
owner-occupied housing is treated as a business in BEA's national
income and product accounts.
(4) For a more extensive discussion of sources and methods, see
Experimental Estimates of Gross State Product by Industry, Bureau of
Economic Analysis Staff Paper 42 (Washington, DC: U.S. Government
Printing Office, May 1985). The paper is available from the National
Technical Information Services, 5285 Port Royal Road, Springfield, VA
22161: Accession No. PB85-240885, price $26 (paper copy), $9
(microfiche).
(5) Benchmark years in the GSP series correspond with those in the
national income and product accounts (NIPA's). The estimates in
this article reflect benchmark-year estimation for 1977 and 1982; they
do not reflect the recent comprehensive, or benchmark, revision of the
NIPA's for 1987.
(6) See U.S. Department of Commerce, Bureau of Economic Analysis,
State Personal Income, 1929-87: Estimates and a Statement of Sources and
Methods (Washington, DC: U.S. Government Printing Office, 1989). The
publication is available from the Superintendent of Documents, U.S.
Government Printing Office, Washington, DC 20402: GPO Stock No.
003-010-00197-6, price $16.