Economic preprocessor

There are 72 series marked as "economic" in the "group" field that are read into the preprocessor. Most of them come from World_Development_Indicators (WDI). There are quite a few series marked as "IMF GFS 2013 BATCH PULL". There are a lot of data on the informal economy from ILO-WIEGO. Cyber data also appears to be read into DataEcon.

Sources

IMF, ILO, WDI, Global Trade Analysis Project (GTAP) 

Economic series used in preprocessor

TO BE COMPLETED

Initializations

Use government consumption and expenditures data to initialize SAM.

Government consumption

Government consumption (CGovCon) is initialized using SeriesGovCon%GDP.

Source: WDI

Definition: Government (general) final consumption as % of GDP

Data Description- General government final consumption expenditure (formerly general government consumption) includes all government current expenditures for purchases of goods and services (including compensation of employees). It also includes most expenditures on national defense and security, but excludes government military expenditures that are part of government capital formation.

CGConFromSectors = GExpDef(ICount%) + GExpEd(ICount%) + GExpRandD(ICount%) + GExpHl(ICount%) + GExpInfra(ICount%) + GExpInfraOther(ICount%)

Set CGovCon as the max of CGovCon and the CGovCon calculated as the sum of sectors. Bound between 9 and 35.

Government expenditures

Initialize central government expenditures and total government expenditures and then calculate local government expenditures as the difference.

Central government expenditures (GovtExpCentral) is initialized using SeriesGovExpense%GDP

Source: WDI

Definition: Government expense as % of GDP (compare with govt expenditures)

Extended definition: Expense is cash payments for operating activities of the government in providing goods and services. It includes compensation of employees, interest and subsidies, grants, social benefits, and other expenses such as rent and dividends

Note: This series has "government" as the group.

Use SeriesGovtCalcExpendTot%GDP to initialize total government expenditures.

Source: IMF GFS

Definition: Expenditure, government, total, as % of GDP

If null, then use SeriesGovTotalOutlays%GDP

Source: OECD Statistics Database Online

Definition: Government total outlays (% of GDP), including forecast

Hard code 46 in for Ireland in 2010 because of bailout.

If no data on total expenditures still, then we cannot estimate local so we use this equation:

        If IsNull(CGovTotExp) Then
            CGovExpLocal(ICount%) = 2 + 12 * Amin(20, CGDPPCP(ICount%)) / 20
        Else
            CGovExpLocal(ICount%) = AMAX(1, CGovTotExp - GovExpCentral)
        End If

        CGovExp(ICount%) = GovExpCentral + CGovExpLocal(ICount%) 'Add Central plus local to get total

'   Go to total govt expenditures and filling holes when have data in order to compute local govt
'       When do not have total and therefore ability to compute local govt,
'       estimate at 2-14% of GDP (OECD gap between total and central is 14%)
'       North, Walli, Weingast p. 10 have table showing grows from 1-2% to 16%

Government revenue

Central government revenue (GovRevCen) is initialized using SeriesGovtCurRev%GDP

Source: WDI

Definition: Current government revenue as % of GDP

Extended definition: blended with old Ifs data.  Revenue is cash receipts from taxes, social contributions, and other revenues such as fines, fees, rent, and income from property or sales. Grants are also considered as revenue but are excluded here.

If it's null or less than 5 then we use GDP per capita to estimate.

Total government revenue (GovRevTot) is initialized using SeriesGovtCalcRevTot%GDP

Source: IMF GFS

Definition: Revenue, government, total, as % of GDP

If GovRevTot is null i.e. there is no data for total government revenue for the country in SeriesGovtCalcRevTot%GDP (or the value is less than 5) then esimate using GDP per capita (2005). Then set GovRevTot as the max of total government revenues and central government revenues. Cap total government revenues at 75. Set local government revenue as the difference between total and central.

Note: This logic creates problems for countries where there is not a total government revenue data point but there is a central government data point (ex. Malawi). In this case, both total government revenue and central government revenue are initialized as the data value for central government revenue and local government revenue is set at zero (the difference between total and central).

Firm tax rate (CFirmTaxR) is initialized using SeriesTaxCorp%Tot

Source: IMF Government Finance Statistics (2001)

Definition: Corporate taxes as percent of total central government revenue

Note: Apparently not part of batch pull. Also, has "government" as the group.

Social security tax (CSSWelTaxR) is initialized using SeriesTaxSocSec%CurRev 

Source: WDI

Definition: Social security taxes as % of total govt revenue

Indirect taxes (CIndirectTaxR) is initialized using SeriesTaxGoodSer%CurRev

Source: WDI

Definition: Taxes on goods and services as % of total govt revenue

Household taxes (CHHTaxR) estimated as residual from firm, welfare, and indirect taxes

Transfers

CGovSSWel is initialized using SeriesGovSSWelBen%Exp

Source: WDI

Definition: Government Social Security and welfare expenditures as % of total expenditures

Note: Not included in last WDI batch pull

Reconciliation

'       Govcon+SSWEL=GOVEXP; give priority first to boosting Govcon, then reducing sswel, then boosting Govexp
            'i.e. protext all of govcon and boost if possible; reduce sswel as needed; reduce govexp after sswel

Pensions

Government pensions (CGovHHPenT) are initalized using SeriesGovtPension%GDP

Source: Data was processed from World Bank's  pensions site.

Extended source: "International Patterns of Pension Provision" by Palacios and Pallares-Miralles,  2000; OECD Social Expenditure Database. World Bank Pensions Performance Indicators Q2, 2013.

Definition: Government (public) pensions as % of GDP

Note: Newer pension data exists in IFs but is not pulled into preprocessor

Reconcile with trade

Normalize Expenditure Components to 100% - (X-M)

Split into sectors

Government consumption

'   Split Government Consumption and Investment into Sectors of Origin
'   ------------------------------------------------------------------

    For ICount% = 1 To CCount
            GMN(ICount%) = 0.1 * CGCon(ICount%) 'Manufacturing spending assumed to be 10% of conumption
            GSR(ICount%) = 0.9 * CGCon(ICount%) 'Services spending assumed to be 90% of consumption
            IMN(ICount%) = CINVEST(ICount%) * 0.5 'Manufacturing investment assumed to be 50% of investment
            ISR(ICount%) = CINVEST(ICount%) * 0.5 'Services investment assumed to be 50% of investment
    Next ICount%

Personal consumption

'   Split Personal Consumption into Sectors - Use Value Added and AMAT
'   ------------------------------------------------------------------

Use AMAT data to initalize personal consumption for agriculture, manufacturing, and services.

Adjust personal energy consumption based on world energy price and energy exports (exporters tend to consume more).

Initalize ICT personal consumption using ICTShare

Normalize with total consumption.

Social Accounting Matrix

'   Social Accounting Matrix Stocks.  Begin with Stocks because some needed for flows

Stocks

'   SAM Stocks: Start with World Bank and IMF Loans and Credits - Want to be
'       sure that external debt/assets cover known values

World Bank (CXWBLOANS) is initialized using SeriesXWBLoans%GDP.

Source: WDI Batch Pull

Definition:IBRD loans and IDA credits as % of GDP

Notes: mjs: Data is transformed to percent of gdp using current us$ GDP; MJE

IMF loans (CXIMFCREDIT) are initialized using SeriesXIMFCredit%GDP.

Source: WDI Batch pull

Definiton: IMF credits as % of GDP

Notes: mjs: Data is transformed to percent of gdp using current us$ GDP; MJE

'   Allocate World Bank Loans to Advanced Countries
'   -----------------------------------------------

Allocate total World Bank loans to "advanced countries" (countries with GDP per capita over 10,000 USD and no World Bank loans) based on size of economy. Use one countries share of the total GDP of all advanced countries to determine the share of total WB debt that they lend.

        PerCap = CGDP(ICount%) / CPop(ICount%)
        If PerCap > 10 And CXWBLOANS(ICount%) <= 0.001 Then
            CXWBLOANS(ICount%) = -CGDP(ICount%) / AdvGDPXWBDebt * (GloXWBDebt / AMAX(1, sxwblneqr))
        End If

Do the same for IMF debt.

Initialize public and private guarenteed debt (PPGDEBT) using SeriesXDEBTPPG%GDP

Source: WDI Batch Pull

Definition: External debt, public and publicly guaranteed, as percentage of gross domestic product

Initialize external debt (private non-guarenteed) (PNGDEBT) using SeriesXDEBTPNG%GDP

Source: WDI Batch pull

Definition: External debt, private non-guaranteed, as percentage of gross domestic product

Assume firm debt (CXFIRMDEBT) is half of the sum of public and private guarenteed and private non-guarenteed.

        CXFIRMDEBT(ICount%) = PNGDEBT + PPGDEBT * 0.5
            'Need to break PPGDEBT better between private/governmental
            'Probably poorest countries have highest govt share

Allocate external firm debt to advanced countries using same procedure for IMF and WB debt above

'   Augment External Debt Data with Current Account Accummulation and
'       Compute Global Balance
'   -------------------------------------------------------------------