ON THE OPTIMUM METHOD FOR CHINA'S CROP YIELD SURVEY

Chen Guoshun, Statistical Research Institute Hebei Provincial Statistical Bureau, Shijiazhuang, China

KEYWORDS: Crop yield survey, Crop-cutting, method has been used in some villages, counties Farmer-recording and prefectures in China. Experience has proved that this method is simple, accurate and easy to 1. Introduction implement. However, because there have been no China has tried the following methods for its theoretical or practical comparisons with the crop­ crop yield survey: cutting method, the farmer-recording method has (1) Reporting from the bottom (village) all the not been paid enough attention and therefore has way up to the top (Nation), not been acknowledged. (2) Estimating by crop-cutting sampling, This paper compares the farmer-recording (3) Estimating by typical farmer interviews method with the crop-cutting metbod and testifies (investigating) and others. that the former is the optimum method for China's The first method has been less applicable since crop yield survey. the reform of China's rural economic system, while 2. New Cognition of the Croo-Cutting Method the crop-cutting method has replaced it and become The crop-cutting method, which is an objective the most important method - the official data of method in theory, has many limitations in practice crop yield are based on it. The typical investigating since, in fact, one cannot easily get the real or interview method and others have not been used objective results from the sampled plots. This very often in crop yield surveys. method is currently being challenged both in theory The crop-cutting method is known as an and practice. So it is useful for us to review the "objective" onc since under ideal conditions it is not "objective" nature of this method. The following are influenced by human behavior. Therefore, many some of the shortcomings of the crop-cutting countries and areas have used this method for crop method. Some of these are well-known old yield surveys and more and more people get the problems, while others are special to China. chance to study it. Although both the theory and (1) Complexity. This method involves complex practice of this method have been developed over procedures such as selecting sampling plots, drawing the years, experts in China as well as other the map of the sam piing plots, and cutting, countries have found that the crop-cutting method threshing, drying, and weighting, the crop, etc. has many probkms which cannot be solved easily. Before the cutting work begins, investigators and These include the complexity of the method, the respondents must be trained. Whenever the harvest unpredictability of bias and errors, the big workload season comes, Statistical Bureau at various levels, and high cost, etc. All these have limited the use must send large numbers of investigators to direct and spread of the method. These are also the the work in the villages. The main reason why this reasons why we cannot use this method for crop method has not been used by all the villages in yield surveys throughout the country at various China is because the sampling work cannot be done levels, especially village, township and county levels. independently by respondents of the villages. The question then is whether there is any (2) Unpredictability of bias and errors. This other method which is simpler, more accurate, and method has two kinds of errors: Sampling error involves less work and less cost than the crop­ and non-sampling error. While the former can·be cutting method. The answer is ·positive. The solved by increasing the number of the sampling method may be called the farmer-recording units, the latter cannot be controlled by that. This sampling method. In this method, the household is is the biggest problem faced by sampling theory and taken as the basic sampling unit instead of the plot. practice at present. Tore Dalenius points out in The word "recording" means that the farmers Elements of Survey Sampling that practice has themselves weigh and write down how much they proved that the crop-cutting sampling results might harvest. The key of the method is to let farmers result in biased estimates because the boundaries of record rather than state their results. By this way the sampling plots cannot be correctly outlined. we can get the real crop yield of the households Honeyer and Black (1946) found that the data (sampling units) so as to estimate the total crop obtained from sampling plots of 2 sq. ft. area each yield of the area. The farmer-recording sampling was 8% higher than those of 3 sq. ft. each.

62 Research in five African Countries, Benin, Central sampling for the crop yield survey due to the high African Republic, Kenya, Niger and Zimbabwe, also cost of the method. found that the crop-cutting method gave over­ The above are some of the main shortcomings estimates of between 14% to 38%. Because of the of the crop-cutting sampling method. These have UDpredicta-bility of the bias and errors, it is hard to already limited the spread of the method. The most know the degree of the precision of the method. important thing is that many villages, townships and (3) Difficulty Deciding Plot Size and Shape. In counties cannot use this method for the crop yield order to control the bias of the crop-cutting survey and their needs have to be met by other sampling, the plot size needs to be appropriate. methods. Fortunately, in practice, a more suitable According to the experiences of experts from India, method for the crop yield survey has been found: the plot size of 100.9 sq. ft. is the most economical the farmer-recording sampling method. size leading to unbiased estimates. But this ·will 3. New Considerations of the Farmer-recording need a big workload. Moreover, the bias from Sampling Method different shapes of plots are also not the same, the The farmer-recording sampling method - bias from a row sample being the biggest. (See which is the method of letting farmers weigh and Estimation of Crop Areas and Yields in Agricultural write down their results - has been thought of as a Statistics, pp 82-86) subjective method and so its use has been ignored. (4) Lack of cooperation. The time when the The main reason for calling it "subjective" is that sampling plots should be cut is the harvest season. farmers may not give the right figure of their Peasants are both busy and tired at that time and harvest and the results might be influenced by they do not like to cooperate with the sampling human behavior. However, this is not the case in work. At the same time, peasants also do not like China today. The crop yield offarmers is no longer to let the sampling plots be located in their fields. a secret because ever since the new rural economic So the sampling work cannot be done smoothly. system came to the village farmers have enough to Besides, many investigators at the county level have eat. So, the very lucky thing is, if the data of the families in the countryside and they have to help sample units - farmer's crop yield can be got their wives. Therefore, the results of the sampling correctly, the farmer-recording sampling method cannot be guaranteed. will be objective. (5) Simulation of real crop losses. The method of Considering China's own condition, it is crop-cutting within a sampled plot is different from feasible to adopt the farmer-recording method at all harvesting big areas in that it cannot reflect the levels of villages, townships and counties and thus degree of losses in cutting, transporting, threshing meet their needs. The following features of this and drying when large areas are harvested. The method show that it has many advantages as error due to this fact cannot be easily estimated. compared to the shortcomings of the crop-cutting (6) Risk taking. The harvest season in autumn in method. Northern China lasts two months. Investigators (1) Simple. This method is so simple that almost cannot watch the sample plots all the time. Thus, everyone can do the work, whether it is simple it often happens that the sampled plots are cut by random sampling or systematic sampling. The peasants without informing the investigators. In techniques used by the method such as selecting fact, complete yield results of sampled plots are families, weighing and writing down the results as rarely obtained. Also, the sample cut might be well as estimating (using only simple arithmetic eaten by chicken or pigs, and cannot be replaced. averages) can be learnt by the respondents of the Therefore, it is hard to get objective results even by villages in less than an hour. They can do the work the objective method of crop-cutting sampling. completely without the help of the investigators of (7) Big workload. When the crop cutting time the Statistical Bureau of the County. So this comes, the Statistical Bureau at the county level method can be used by all villages of China without must send almost all its staff to help with the work difficulty. because of the workload. Thus other work is often (2) Controllable bias and errors, This method also neglected. has two kinds of errors: Sampling and non­ (8) High cost. Every year the nation has to sampling errors. The sampling error can be provide a lot of money for the fees of investigation, decreased by increasing the number of sample units. training, subsidy for the investigators and And the non-sampling error - the deviation of the compensation to farmers for loss of the sample farmer's yield recording from the real results - can yield. Some counties cannot use crop-cutting be solved if the grain can be weighed accurately.

63 This is achieved by providing respondents with yields of their harvests correctly? China is a weighing equipments which is no problem. country with a glorious history in culture and people (3) Suitable for any size and shaDe of the sample esteem knowledge very mucb. Usually at least one units. No matter what size the sample units are person in a pesant family has a good education so (the households may be big or small) and no matter the data of the crop yield can be written down what shapes the fields of the household are (round rightly without any questions. or rectangular), we can get unbiased results of their Can the farmer weigh the grain of the harvest yields by weighing all the grain in the farm. easily? The land is distributed almost equally (4) Easy to cooperate. This method does not between peasant families based on the number of involve crop cutting on sample plots in the fields of people in the family. The family sizes of the the farmers which is not welcomed by them. They farmers do not vary very largely. So there are few only need to cooperate by agreeing to weigh the real big peasant farms in China. The average size grain in the farm. If we do the propaganda of a farm land was 1.1 acres and the average grain properly and give farmers appropriate subsidies for production was 1.9 tons for one household in 1989. their work they would like to cooperate. The total grain production is indeed not a big figure (5) Crgp losses. The cutting, transporting, for a household. If the weighing equipments are threshing and drying are all done by farmers provided, the weighing work can be done without themselves so by this method we can get the real any difficulty. yield of the crop instead of an ariificial estimate As for the data of big farms, crop-cutting from sampled plots. sampling methods can be used to estimate the crop (6) Safeguarding. This method does not involve yield. Thus it is quite practicable to use the farmer­ any risk of losing the sample because the farmers recording method for the crop yield survey in China. will harvest when they have to and get what they 4. Farmer-recording Method in Practice should. The preceding sections have discussed the (1) Small workload. The sample work can be done advantages of the farmer-recording method for crop by respondents of the village independently and the yield survey in theory. This method is very weighing and recording can be done by farmers promising because it has so many advantages over themselves. The county Statistical Bureau does not the crop-cutting method. The most important thing need to send a lot of investigators to help direct the is that this method can be used by all the villages, survey, so the work is lessened. townships and counties in China. (8) Low cost. The sam pie cost is reduced because How does the farmer-recording method work this method needs less fees for investigators, less in practice? Is it so subjective that the crop yield compensation to farmers for the loss of the sample data got from it are not acceptable? Facts speak and less workload. louder than words. Let us look at the results of the The aforesaid statements are the advantages of crop yields of Hebei Province estimated by both the farmer-recording method for crop yield surveys crop-cutting and farmer-recording methods. and more may be listed. The key to the usefulness of this method lies in the answer to the question Table 1. Crop Yields of Hebei Province 'DO FARMERS GIVE REAL RESULTS?' If the (Unit: kg/mu) answer is yes, the method is objective. If not, the method is subjective. Let us first look at the condition of China Years a b c=b-a (c/a)% today and study the ease of another sample survey - the rural household budget survey. In this method the household is also taken as the basic sample unit 1985 199.7 197.7 -2.0 -1.0 to obtain income and expenditure estimates at 1986 191.6 184.6 -7.0 -3.7 various levels. The farmers record the incomes and 1987 183.2 182.2 -1.0 -0.5 expenditures of their families every day and to the 1988 202.5 181.3 -21.2 -10.5 last cent that they get and spend, even the money 1989 204.0 195.8 -8.2 -4.0 they get or lose from gambling, because the data they provide is kept confidential. So there will be no reluctance on the part of the farmers to give the a - crop yield estimated by crop-cutting method real results of their crop yield. b - crop yield estimated by farmer-recording Do farmers have the ability to record the method

64 Table 1 shows that the data of crop yields of found that big differences might happen. For Hebei Province estimated by the two methods are example, the differences between the wheat yields of quite close, except in 1988. Given that the standard five villages selected from the county in 1989 as error of the estimates, a = 10, even the biggest obtained from two sets of sample plots for each differences of the crop yields got from the two village were 36,3,1,22 and 9 kgs per mu respectively. methods in 1988 is within 3a. That is to say, the Yet there is no reason for us to suspect the crop yields estimated by these two methods are sampling results. Moreover, we have favourable statistically the same, i.e. if the crop-cutting data are conditions to use the farmer-recording method for acceptable, the farmer -recording data are acceptable the crop yield survey because the lands of families too. for a village are also distributed according to the Now let us see the results for a village. If the grade of land and the deviation of the crop yield crop yield data of a village can be got easily with a within a village is usually very small. Taking low cost and satisfactory accuracy by the farmer­ Dongcba Village of Xingtang County as an example, recording method, we can add them up to meet the for this big village with 440 families the standard needs of townships, counties as well as provinces deviation of crop yields in 1989 was ouly 4.6 kg per and the nation. Also, we can use the village data to mu and the relative standard error was only 1.65%. estimate the crop yields at all levels. The following All these have created many good conditions table is based on the results of Xiangyan village, for us to use the farmer-recording method for the ling Xian County, Hebei Province, where a and b crop yield survey in China. Thus, by using the have the same meaning as in table 1. farmer-recording sampling method we obtain crop yield data that can be as reliable and accurate as Table 2. Crop Yields of Xiangyan Village the data from the crop-cutting method but with less (Unit: kg/mu) cost, less work and less time.

5. Farmer-recording Sampling n the Optimum Method Years a b c=b-a (c/a)% We have compared the farmer-recording and crop-cutting sampling methods both in theory and practice. It is very clear that the former has many 1985 172.9 151.6 -21.3 -12.3 advantages over the latter_ Yet, in order to prove 1986 141.9 140.8 -1.1 -0.8 that the former is the optimum method for crop 1987 115.7 99.1 -16.6 -14.3 yield survey in China we should compare these two 1988 179.7 176.1 -3.6 -2.0 methods with certain criteria. According to Tore 1989 176.4 164.1 -12.3 -7.0 Dalenius in Elements of Survey Sampling, three criteria for a good sample design are (1) the measurability criterion, (2) the efficiency criterion, Table 2 tells us that the crop yields got from and (3) the simplicity criterion. the farmer-recording method are 'lower than the First of all, just the same as for the crop­ crop-cutting data. That is reasonable and suits the cutting method, the farmer-recording method is reality because of the losses of cutting, transporting measurable in that the sample units, households, are and threshing the crop, etc. From the data of 1986 selected with known probabilities, whether simple and 1988 we can certainly say that the farmers gave random sampling or systematic sampling is used. the right results of their crop yields otherwise the Second, the farmer-recording method is more data of these two years would not be so close. This efficient than the crop-cutting one because with a proves that the data given by farmers are correct lower cost it can obtain the crop yield data with the and the results got from the farmer-recording required accuracy. Third, the farmer-recording method should be objective. method is more simple, which is the fact well known As for the differences, we statisticians know by all. So the farmer-recording method snits the that that is the effect of two different methods, three criteria well and is a very good sample design which is not at all surprising. Even with the same for the crop yield survey. crop-cutting sampling method, differences exist From the above studies we conclude that the within different sets of sample units. Investigators farmer-recording sample method is the optimum of Xingtang County, Hebei Province have drawn method for China's crop yield survey. We can use two sets of sampling plots to compare the results of this method in villages, townships, counties and up crop-cutting method with different sample units and to provinces and the nation. By spreading this

65 method and using the crop-cutting method as a Hansen, M.H., Hurwitz, W.N. and Madow, W.G. supplementary method for large farms, we can meet (1953), the needs of various levels for data on crop Sample Survey Methods and Themy, vol. 1. production. John Wiley & Sons, New York, V.SA.

BIBLIOGRAPHY U.S. Bureau of the Census (1968), Supplemental Courses for Case Studies in Surveys and Cochran, W.G. (1977), Sampling Techniques (3rd Census. Sampling Lectures, lSP Supplemental Edition). Course Series, No.1, Washington, D.C., John Wiley & Sons, New York, U.SA. U.SA.

Dalenius, Tore (1985), Elements of Survey Verma, V., T. Marchant and C. Scott (1988), Sampling. Evaluation of Crop-cut Methods and Farmer Notes Prepared for the Swedish Agency for Reports for Estimating Crop Production Research Cooperation with Developing Results of a Methodological Study in Five Countries (SAREC). African Countries. Longacre Agricultural Development Centre Limited, London. Food and Agricultural Organization of the United Nations (1982). Estimation of Crop Areas and Yields in Agricultural Statistics. FAO, ROME,!TALY.

66 THE ROLE OF NATIONAL ACCOUNTS AND ITS IMPACT ON SURVEY DESIGNS: THE ZAMBIAN PERSPECTIVE

Ackim T. Jere, Central Statistical Office, P.O. Box 31908, Lusaka, Zambia

1. Introduction independence in October 1964. Northern Rhodesia, It is generally accepted that National Accounts now Zambia, was a colony of the British provide a framework through which the Government. At that time the Federal statistical performance of an economy can be monitored and office which was based in Salisbury (now Harare), evaluated. National Accounting is simply a Southern Rhodesia (now Zimbabwe) granted systematic way of classifying the multitude of authority for establishing a statistical office in economic activities that take place in the economy, Lusaka, the Capital City of Zambia. The setting up in different groups or classes, that are regarded as of the statistical office in Lusaka was accomplished being important for understanding how the economy soon after the attainment of political independence works. Construction of National Accounts is, in 1964. however, a very intricate process which requires The young and small office was initially run special skills since sources of data needed to with the assistance of technical co-operation from construct reliable and useable National Accounts the United Nations Statistical office. Some of the estimates are generally derived from numerous important and salient statistics produced then sources. included estimates of national income. The Census The level of statistical development associated of Europeans or Non-Africans was also conducted. with a country will in general be reflected in the Over the years the Central Statistical Office diversity and perhaps more importantly in the (CSO) has expanded and it now undertakes a lot of quality of statistics produced. It is argued in this statistical activities. For instance, the office has paper that the quality of National Accounts conducted censuses of Population and Housing in estimates is affected by the designs of the different 1969, 1974, 1980 and most recently in 1990. The surveys whose results are an input into the experiences gathered over these years have rendered construction of the accounts. Moreover, developing a lot of improvements not only in survey designs countries generally do not have adequate resources and methodologies, but also in the designs and to mount statistical systems which will ensure that construction of survey instruments. The CSO now data collection is fuUy and effectively accomplished. produces a host of statistics, which include Consequently, significant gaps may exist in the Agricultural statistics, Economic statistics such as statistics produced. Zambia may not be a model of the Nationhl income accounts, Industrial production, developing countries but it certainly has features Prices, Employment and Earnings, Government which are quite common among developing Financial statistics, Balance of Payments and countries, particularly in Africa. External Trade, as well as Health, Education and It is also a recognised fact that the preparation Migration statistics. of National Accounts usuaUy demands a rather The CSO has been keeping abreast of statistical systematic way of data collection to ensure the developments and efforts have been made in production of useable accounts. In doing so, producing statistics in relatively "new" areas such as Zambia adheres to the recommendations of the gender, environmental and the informal sector United Nations system of National Accounts. statistics. These are new areas for Zambia's CSO This paper essentially discusses National and it is expected that improvements will be Accounting practices in Zambia and the relationship instituted in the scope and quality of these statistics of the National Accounts with establishment over time. surveys. A brief historical development of the Processing of statistical data had for a long time statistical system in Zambia is also discussed with a been done manually even as recently as in 1980. focus on the types of establishment based surveys Since then, however, computer data processing has currently being conducted in Zambia. dominated in virtually all fields, and all survey/census data collected by the CSO are now 2. Development of the Statistical System in processed using computers. In recent years micro­ Zambia computers have been predominant in processing Production of statistics in Zambia predates survey data and various software such as Dbase III

67 & IV, USP, SPSS, SAS, spreadsheet Lotus 123, etc. Offices Headquarters with all the nine provincial are in current usc. The main objective is to statistical offices and statistical units in the computerise the statistical system and reduce the ministries is referred to as the Unified Statistical manual processing of data as much as possible. System (USS). The Director of Census and Statistics who is the de facto Head of the USS is 3. Central Statistical Office Organisational also the advisor to the Government on matters Structure pertaining to statistical improvements and Zambia has a centralised statistical system in developments in the country. which major statistical activities are undertaken by the Government's Central Statistical Office (CSO) 4. Economic Statistics Branch whose head is the Director of Census and Statistics. The Economic and Financial Statistics Branch The CSO has been and continues to be the major comprises mainly of the following Economic source of socia-economic statistical information in Statistics Divisions: Balance of Payments and the country. It is empowered to carry out the External Trade, Public Finance, Industrial statistical functions under an Act of Parliament Production, Prices and National Accounts. Each of Chapter 425 of the Laws of Zambia. It should be these divisions, normally headed by a Senior emphasized that, though some other organisations Statistician, periodically collect and compile data on may be data producers of one form or the other, different aspects of the economy which are primarily the CSO remains the major producer of statistical used in monitoring and evaluating economic information in the country. development trends in the country and for planning Since its inception in 1964, CSO has grown purposes. from a little statistical office into a large office with For Zambia the above mentioned subject areas a wide range of statistics being produced in are the ones in which establishment-based surveys response to the increased demand for various socio­ dominate with the sampling and/or reporting units economic statistical information in the country. being establishments. FunctionaUy the CSO is currently organised in Data for these economic surveys are usually three subject-matter Branches. Each Branch is collected by means of mail-out questionnaires or headed by an Assistant Director. Branches are schedules/forms. Examples of these surveys include further sub-divided into Divisions and then Sections. the annual Census of Industrial Production; a The Branches are: quarterly enquiry of construction output in the (i) Agricultural and Environmental Statistics private sector; a monthly enquiry among selected (ii) Economic and Financial Statistics establishments in the Mining, Manufacturing and (iii) Social and Cultural Statistics Electricity sectors to establish production trends; the In addition there are service units which service annual enquiry of the services sector (wholesale, the subject-matter Branches, namely, Cartography, retail and related services trade); and a monthly Information and Research, Data Processing and enquiry on prices among selected establishments Administration. Furthermore, there are Provincial and market outlets. An establishment register Statistical Offices, one for each of the nine which constitutes the Master Sampling frame of provinces in the country. These offices are at virtually most of the economic surveys conducted by present only data collection centres for the various the CSO, is maintained at the CSO Headquarters in CSO surveys and censuses. Each office is headed Lusaka. The current practice is that questionnaires by a Provincial Statistical Officer (PSO ) (who is are dispatched by postal service from Lusaka. usually a holder of a statistical diploma obtained The above mentioned surveys provide a vast after grade 12 level of academic education) and is body of data from which numerous statistics are manned by his Deputy, about 4 supervisors and not produced. These include the wholesale and more than 30 enumerators. PSOs are answerable to consumer price indices; the index of industrial the Director of Census and Statistics. production; balance of payments; Gross Domestic Moreover, there exist statistical units in some Product by kind of economic activity and by type of line ministries of the country which primarily service expenditure; and external trade statistics. planning units in those ministries: Agriculture, Food Invariably, the surveys for the different areas in and Fisheries; Education; Health; Development and the Economic and Financial Statistics Branch arc Community Services; Mines; and Labour and Social designed, organised and conducted in a manner Security. intended to serve primary data users in the specific The amalgamation of the Central Statistical areas concerned. However since these data also

68 constitute the building blocks for the construction of (iii) The Government sector account National Accounts, some consideration is often (iv) The Capital Accounts given to satisfy National Accounts requirements (v) An account for transactions with the rest of also. This is done by designing appropriate samples the world. and survey instruments to provide for the required The fundamental point to note is that detail of data to meet the needs of both primary construction of these five accounts demands a lot of data users in the specific areas as well as the basic data from numerous sources, and their collection needs of National Accounts. and compilation should be systematic and consistent In trying to accomplish the above it becomes in order to produce useable National Accounts. It obvious that designing surveys will always be also requires the design of surveys which are affected in order to ensure that National Accounts comprehensive in scope and coverage. Since it is requirements are met, even though partially. the enterprise/establishment sectors account which is of particular relevance to this conference, the 5. National Accounting in Zambia following focuses on that account. Zambia adheres to the guidelines and Enterprises or establishments are further recommendations set out by the United Nations classified into economic activities in accordance with System of National Accounts (SNA) in its the UN International Standards of Industrial compilation of the National Accounts. The revision Classification (ISLe) of economic activities. The of the 1968 version of the UN SNA is currently following approach is used for the survey designs. underway and the 1993 SNA draft has been In each economic sector establishments are published. Zambia, like most of the other countries broadly classified as large and small ones. In using the UN SNA, has been following with keen general, all establishments which employ less than interest the revision and has been participating in 10 employees or with capital valued at less than the debates on the revision through the UN K250,OOO in 1980 prices are classified as smaIL Thc Economic Commission for Africa. rest of the establishments are referred to as large and these include all parastatal establishments 5.1 System of National Accounts irrespective of whether or not the value of capital National Income is a double flow, one physical owned is less than K250,OOO in 1980 prices. Large and the other monetary representing the flow of establishments are surveyed on a 100% basis goods and services on the one hand and the flow of whereas small establishments are surveyed on a money incomes or expenditures on the other, from sample basis. producing to consuming units and vice-versa. Any transaction requires 'two' transactors, the one who 5.2 Sources of Data pays and the one who receives. Indeed in the It has been pointed out elsewhere that the data process of economic activity. producers and inputs used in the estimation of Zambia's National consumers enter into various transactions. The Accounts are generally obtained from a variety of influence exerted by one group on the other and the sources. Divisions of CSO responsib"; for specific way one reacts to change in the other depends on subjects provide most of the requisite data as the extent of their inter·relationships. indicated below. Basically, a quantitative description of such (a) The Agriculture and environmental statistics inter-relationships is sought to be achieved through Branch provides production figures on Crops, a system of interlocking accounts. National income Livestock, Fishing, etc. in respect of commercial accounting is therefore achieved through a double and traditional farmers, etc. entry accounting system in which onc transaction (b) The Census of Industrial Production (CIP) appears as a receipt in onc account and again as a Division provides data relating to Mining, payment in another account. To facilitate this the Manufacturing, Electricity and Construction economy is generally be split into various industries. It also prepares various indicators components called sectors so that the accounts for such as index of industrial production. the different sectors taken together will reflect the (c) Data for the services sectors of the economy is economic activity of the system as a whole. Five obtained through the annual National Income basic sector accounts identified for this, namely: enquiry (see Section 5.4). (i) Enterprises/establishments or business (d) The Prices and Consumption Statistics Division sector-producing sector account provides a wide variety of statistical data on (ii) Household sector-Consuming sector account prices. Notable among these are the price

69 indices. Periodically it works out estimates of 5.3 Compilation of National Accounts household expenditure surveys. Gross Domestic Product (GOP) is the macro­ (e) Balance of Payments and External Trade economic measure commonly used in the evaluation Statistics Division provides imports and exports of the performance of an economy. It is one of the data and any other transactions with the rest of main economic aggregates compiled in the National the world. . This data is mostly used in Accounts. estimates of Gross Domestic Product by type of Generally, GOP is defined as the market value expenditure. of goods and services produced within a given (f) Public Finance Division supplies data on country in a given period, usually one year. government revenue and expenditure and other Technically the GOP can be computed through information related to government activities. three approaches, namely the Production (g) Labour Statistics Division supplies data on (sometimes called output), Income and Expenditure employment and earnings of the various sectors approaches. of the economy. In the Production approach, the value of all fmal goods and services produced in the country It must be stressed, however, that some of these during the year is measured. For each sector the data are not in the format which is suitable for production accounts are prepared to derive the national accounting purposes and adjustments are value added of each sector. In the Income made before incorporating them into the National approach, the incomes that accrue from the factors Accounts. of production provided by the residents of the In addition, use is made of data gathered country are summed up. The Expenditure approach through adhoc surveys such as Zambia's 1986 counts up the total expenditures of the people, Labour Force Survey, Census data, etc. These will, firms, government and local authorities. Some of in most cases, provide benchmark data. National this is expenditure on consumption goods, but some Accounts statisticians have to make the best usc of of it is investments in fixed assets, buildings, motor the available data to construct the components that vehicles, plant and machinery, etc. make up the present National Accounts estimates For Zambia, the Production and the for the country. The statistics compiled for Expenditure approaches are the ones-normally used National Accounts include the Gross Domestic to estimate National product or the Gross Domestic Product by industry and expenditure which product. The basis of Zambia's Gross Domestic constitute the most important macro-economic Product figures is the Production approach because aggregates for the evaluation of the performance of the data for this are much more easily available the economy. Furthermore input-output accounts through the establishment surveys alluded to earlier. have been constructed for the country for 1973, As regards the Expenditure approach, all the 1975, 1980 and 1985 calendar years. components of GOP are normally estimated separately except for private fmal consumption Informal Sector expenditure which is obtained as a residual on the Though the informal sector activities have been basis of GOP derived through the Production recognised as an integral part of the Zambian approach. economy, they are not adequately accounted for in A firm basis for private consumption the National Accounts. As is the case in many expenditures is usually a Household Budget survey African economies, the nature of this sector and the (HBS). Unfortunately for Zambia the last lack of sufficient statistical capabilities renders the comprehensive HBS was conducted in 1974/75. coverage of the informal sector problematic. These Surveys are very costly ventures and the In Zambia, however, some economic activities Zambian government has not been in a position to in the informal sector, such as the traditional allocate sufficient funds for the conduct of HBS for subsistence farming sub-sector of the Agriculture a long time. Fortunately this year, a HBS will be sector are covered on a regular basis using conducted with funds provided by the Zambian household surveys. government supplemented with donor funds and Informal sector activities are now receiving a HBS survey instruments have been developed and lot of attention and specialised surveys have been are being tested. Data collection for HBS is identified as possible sources of data. Plans are scheduled to commence in July 1993 and will run underway to conduct a comprehensive survey of the for 12 months thereafter. informal sector in Zambia by next year. In Zambia, every effort is made to improve not

70 only to the quality but also the quantity of the collected. Aggregated data of large establishments statistics currently being produced. The guiding or enterprises is summed up with that of small principle for a National Accounts Statistician is to establishments, (generally grossed-up) prior to strive to produce the best statistics with the data undertaking analysis. available. 6. National Accounts and survey designs 5.4 National Income Inquirv In the Zambian context, in order to assess the Insofar as data collection for National Accounts basic relationship between the construction of purposes in Zambia is concerned, mention should National Accounts, and the various establishment be made of the National Income inquiry. This surveys whicbprovide data inputs for the Accounts, inquiry is an annual survey whose coverage is it is essential to initially examine the data sources confmed to the non-government Service sectors of referred to earlier. the economy. These include Wholesale and Retail It ought to be recognised that some of the data Trade, Hotels and Restaurants, Transport, fmandal sources have other primary objectives and National institutions, real estate and Business Services and Accounting objectives are actually secondary. Thus, Personal and Community services. some adjustments to the data are necessary before In Zambia this is the only survey wholly utilising them in the construction of National designed and implemented by the National Accounts. Accounts Division in a manner which meets the Due to the importance attached to the National National Accounts requirements, such as collecting Accounts in Zambia for evaluating the performance data on components of gross output and of the economy and for planning purposes, all the intermediate consumption in tbe desired format. statistics currently produced within the Unified This facilitates computation of value added at Statistical System almost always take into account establishment level and the subsequent summation National Accounts reqnirements to a large extent. at industry level. In fact, the Director of Census and Statistics has a The total number of establishments and/or responsibility to ensure that National Accounts data enterprises covered under the inquiry has been requirements are satisfied as much as possible around 2,400 over the last couple of years. Data within the USS. This, however, does not necessarily collection is accomplished by mailing questionnaires imply overriding the major objectives for collecting to establishments/enterprises. The filled-in and compiling the statistics concerned. In view of questionnaires are sent back to CSO, normally this, the design of surveys ensure that sufficiently within 30 days of their receipt. Although the basic detailed data are collected which are subsequently format of the questionnaires is similar, each used to compute, for example, gross output, questionnaire is intended to capture the intermediate consumption and consequently value characteristic economic activity (product) of each added accruing to the different sectors of the sectof. economy. Invariably this implies ensuring that In recent years, the response rate for the sample sizes and appropriate survey designs are inquiry has been generally on the decline. Follow­ constructed to compute estimates which will have a up exercises have been undertaken to raise the national representation. response rate to acceptable levels before summary In most cases, adjustments will have to be made totals per sector can be grossed up. A response to some data to conform to National Accounting rate of 60% and above is generally considered as an specifications. A case in point is with regard to acceptable level. industrial production. From the Industrial Grossing up of the data to compensate for non· production point of view what is of paramount responding establishments and/or enterprises is importance is the computation of Industrial normally achieved on the basis of employment data Production Census value added. This concept is supplied by the Labour Division of CSO through different from the National Accounts value added in the quarterly employment survey. It should be that it excludes services transactions. Data on noted that grossing is confmed sector-wise to the services transactions is collected by the Industrial category of small establishments. Summary data Production Division though it is not directly used totals of large establishments are not grossed for evaluating and assessing the industrial because coverage for the large establishments/ production trends in the country. In the above enterprises is on a 100% basis, and no effort is example it can be clearly observed that in the design spared to ensure that data from all of them is of the Census of Industrial Production for Zambia

71 both the Industrial Production and National essentially to serve internal interests of those Accounts requirements are considered. There arc organisations. Notable statistical units are in the situations in which only basic requirements for Central Bank of Zambia and Zambia Industrial and National Accounts are met. In such cases other Mining Co-operation. In many instances these supplementary sources of data may be sought. statistics are derived out of the administrative records kept by the organisations. As a matter of 7. Establishment Based Surveys policy, line ministries in the country are being An establishment is dermed as the combination encouraged to establish statistical units for the of activities and resources directed by a single purpose of processing and analysing the owning or controlling entity towards the production administrative data records under their custody. of the most homogeneous collection of goods and services, usually in a single location but sometimes 8. Conclusion over a wider geographical area, for which separate National Accounts are among the most data can be compiled in respect of production and important statistical data or information which are all the intermediate inputs of labour and capital in high demand by various data users in Zambia. It resources employed for a purpose, directly and in is imperative that requisite data inputs for the support of, or ancillary to, the production. compilation of National Accounts are systematically The history of conducting establishment based and efficiently collected. surveys in Zambia can be traced as far back as 1964 Establishment surveys form the core from when the CSO in Zambia was established. These which National Accounts building blocks are surveys constitute the core of statistical surveys constructed. Consequently, improvements to the which make up the data base for economic statistics quality and coverage of establishment based surveys including the Index of Industrial Production, has been recognised to be a necessary continuous Balance of Payments, Prices, National Accounts, process. The CSO in Zambia will pursue this task and Labour and Earnings. diligently and conscientiously in order to enhance An establishment register exists at CSO the usefulness of the National Accounts and other Headquarters which has a listing of establishments statIstIcs, particularly those derived through classified by their main economic activity, in establishment sutveys. However, the major conformity with the UN's ISIC. As pointed out constraint to this effort is the limited financi al and elsewhere this register is the master sampling frame material resources. from which different samples are drawn for the economic surveys. It should be stressed that at the References national level it is only the CSO which has the 1. Jere, A.T. "Basic economic statistics required capacity to carry out large scale sample surveys. for planning purposes Unpublished paper There are a number of problems associated prepared for the economic commission for with the establishment register. Notable among Africa (ECA) working group on improving the them is non-updating of the register on a regular basic economic statistics required for planning basis. Zambia being a developing country does not purposes·, Addis Ababa, Ethiopia, 19-23 have a lot of resources for frequent and regular September, 1988. updating of the register. However, efforts are 2. Mulenga, M.S.C. (editor). Occasional papers generally made at least once every year to review No.2. A Workshop report on National the status of the register vis-a.-vis closing down and Accounts of Zambia. Central Statistical Office, opening of businesses during the year. Non­ Lusaka, October 1980. response is a major problem encountered in these establishment surveys. Factors which have been 3. United Nations, "Manual on National Accounts identified as major causes for non-response include at Constant Prices·, Statistical papers, series M, the defective sampling frame, wrong postal No. 64, rev,. 3, New York, 1968. addresses, unreliable postal systems and at times 4. United Nations, indexes to the International non-eo-operating respondents. Measures instituted Standard Industrial Classification of all to reduce non-response include physical follow-ups, economic activities. Series M,- No.4, rev. 2, phoning non-respondents and carrying out New York. educational campaigns through various media. There are statistical units in some organisations which also produce statistics on estahlishments,

72 A WORKABLE SYSTEM FOR UPDATING INDONESIA'S MANUFACTURING DIRECTORY

Alex Korns, Development Studies Project and Central Bureau of Statistics, Indonesia JI. Teuku Cik Ditiro 29A, Jakarta 10310, Indonesia

I. Background • Years of special efforts (1985 and 1988) . For survey year 1985, as part of the 1985-86 Manufacturing the fa stest-growing sector in Economic Census, door-la-door enumerators Indonesia .- is estimated in 1991 to account for 2 I % found over 6000 new establishments. For of GDP, exceeding agriculture's share for the first survey year 1988, enumerators mad e a special time. Unique or nearly so among developing effort discussed below, finding 3300 countries, Indonesia' s Central Bureau o f Statistics establishments. During both years, reported (CBS) each year conducts a complete census (using a closures al so were unusually large (13 % of I3·page form) of factories with 20 or more workers. active establishments) but remained much A major problem with thi s data set has been how to smaller than di scoveries. update a Directory of 16 ,SOOactive establishments to keep pace with the appearance of an estimated 2,000 In su m, pre-1990 fluctuatio ns reflect variations in new ones per year. activity of the stati sti cal agency, not in manufacturing activity. Even 1990-9 1 results, while reflecting In developing its manufacturing Directory , Indonesia, progress toward a new Directory system, do not yet in CO llUTIon with many other rapidly industrializing provide the desired measure of growth in establish­ countries, has wrestled with problems of under­ ment numbers. As the system gradually bears fruit , it coverage, double li sting, and nonresponse adjustment. is hoped that 1992-93 data may at last begin to This report is presented in the hope that other measure growth in the number o f establishments. countries may be able to benefit from the Indonesian experi ence. After an initial evaluation phase, CBS began to address the Directory problems in 1988 DIAGRAM 1: Manufacturing Directory 1975-91: Active Establishments, Openings and Closures through pi ecemeal improvements, with mixed results. Faced with a need to monitor more closely the 16 country' s rapid manufacturing growth, CBS then opted Ac tive Establishm ents in 1990 for development of an integrated Directory " updating system designed simultaneously to address all the major problems. The system, which is being 12 implemented in stag es, has given sati sfying results so 10 far, with some "bugs "still remaining. The story of the development of the system is here told chronologicall y • to help readers understand the probl ems encountered along the way, but readers impati ent to know ahout , the new system can jump immediately to section III. r,------.~ Diagram I shows Directory size and gross changes ! , (discoveries, reopenings, closures) during 1975·91. On .~ th e face of it, the fluctuati ons appear erratic and ~ 5 ~ Openings unlikely to refl ect fluctuati ons in economic acti vity. w 4 On examination of updating procedures, pre-1990 '0 -1)' fluctuations can be divided into two kinds of peri ods. c ~ 2 • Years of perfunctory updating (1976-84, o" 1986-87, and 1989). Directory size remained F" tlat, with openings roughly equalling closures, o equal on average to about 6 percent of active establishments. During these years, CBS sent local offices a Direc tory of establishments in th e previous year's survey and instructed fi eld ~1 1 00. ..., I I staff to deliver questionnaires to li sted II establishments as well as to all new/mi ssed ones. ~_ I...... •• I. ~rennmoo~~~~~~~oooooo~

73 II. Directory updating, 1975-89 Casual field inquiries showed , however, that enum­ erators often ignored these rules in reporting new/­ A. Initial findings. A CBS team began in 1988 to missed establishments . 1 Recognizing that users wan­ study Directory problem, with help from the ted data for all establishments in any year regardless USAlD-funded Development Studies Proj ect. The of their previous employment history, CBS decided in study was triggered by a realization that the 1985 1988 to replace the o ld rules for Directory member­ coverage jump had broken the time series. Initial ship with new ones based on employment in the cur­ field observations in areas of industrial concentrati on, rent survey year only . As a result, enumerators could showed that the most significant establishments (in no longer excuse failure to report a new establishment terms of employment) missed before 1985 had been on the ground that it may just possibly have started quite visible. Enumerators often knew where th ey with fewer than 20 workers. The new rule was were. Nevertheless, undercoverage was widespread, adopted in recognition that it would be inefficient for several reasons. annually to recheck all borderline establishments; hence, enumerators might sometimes fail to notice an * Although enumerators were exhorted to deliver establishment crossing the 20-worker threshold . Annual Survey questi onnaires to all new/mi ssed establishments, management lacked tools for C. l abotabek pilot. A pilot study was conducted m checking enumerator compliance. seven industrial districts in and near Jakarta to test * The only procedure for reporting a new estab­ alternati ve techniques for identi fy ing new establ ish­ lishment was to have it fill out an Annual Sur­ ments. BPS staff at provincial and kabupaten levels vey questionnaire. There was no channel for matched the BPS Directory with establishments at reporting the existence of new nonrespondents other agencies, including the Department o flndustry. (although a procedure existed fo r estimating About 1900 "candidates" fo r addition to the Directory noorespondents already in the Directory). were obtained through matching and fi eld checked ; * Enumerators were evaluated on the percent of about 900 qualified for addition to the Directory. their "target" (calculated as their share of the existing Directory) for which they got com­ The study showed that other agency lists were very pleted Annual Survey questionnaires, not (for useful for updating th e Directo ry. However. inas much lack of a standard) whether they reported new as none of them were eith er complete o r accurate, establi shments. They were unenthusiastic about they could not be taken at face value. Field checking report ing new establishments, whi ch were oft en showed that some candidates did not qualify for the uncooperative, because they foresaw hav ing to directory because they had once existed but were return over and over at their own expense to already closed, were under constructi on, had fewer obtain a compl eted questi onnaire. than 20 workers, or existed only on paper and were * Enumerators received no pay ment for searching never realized at all . Accordingly, other agency lists for new establishments, although fo r other fi eld in Indonesia, whi ch are based on permits that refl ect work they usually got piece-rates that an intenti on to undertake acti vity , cannot serve the reimbursed for both time and transport costs. same benchmark fun cti on as tax roll s in the United States and some other countries, which refl ect ongoing B. Conceptual issues. The findin g that the survey acti vity. suffered fro m und ercoverage raised conceptual Issues. Directory updating rules in force before 1988 had D . Coverage of new establishments. In an attempt to been formulated in 1975 , when the share of industry reduce undercoverage in the 1988 Annual Survey CBS in GNP was only 9 percent. The rules were intended implemented fi ve nationwide changes intended to to free enumerators from hav ing to annually recheck imp rove coverage, beside the l abo tabek pilot: ernployment at thousands of srnall factories that mi ght have crossed the 20-worker threshold . The rules * A small "finder's fee" paid to enumerators were: Once entering th e D irectory, estab li shrnents nationwid e for reporting new establishments. remained in it until the next Census even if empl oy­ * A sharp increase in the piece-rate for obtaining ment dipped below 20, while establi shments outsid e it a compl eted Annual Survey questi onnaire, so that once had fewer than 20 workers were not in that enumerators would feel less burdened by scope (even if they rose above the 20-worker thres­ the addition of new establishments to the hold) until th e nex t Census. In li ght of the rules, CBS survey. suspected the 1985 fl ood of new establishments consis­ * The announcement of the new, simplified, rule ted mainly of ones that had been out-of-scope before that made coverage depend ent only on having the 1985/86 Economic Census. 20 or more workers in th e survey year, as

74 mentioned above. E. Closures and doubles. The unusually large number * A new procedure for listing establishments even of closures and reopenings in the 1988 results drew if the enumerator is unable to obtain a attention to two other problems. completed Annual Survey questionnaire. * A new updating manual recommending First, many closures and reopenings were due to matching with other agency lists. churning of double-listed establishments that had entered the Directory in previous years. In most The big coverage gain for 1988 (3300 establishments, cases, only one of the partners in a doubles pair was of which 1000 were in the Jabotabek pilot area) shown as active in any year while the other was shown proved there had been widespread undercoverage and as closed. Whereas before 1988enumerators received that field staff could find many new/missed lists of active establishments only, in 1988 they got establishments without a costly door-ta-door canvass. lists of all ever-active establishments with instructions The gain raised hope that the coverage problem had to check which ones were still active. For doubles, been solved -- a hope tested by the 1989 survey, which they responded by designating one "partner" as active kept all five nationwide innovations introduced in and the other as closed; in many cases, the one 1988. Disappointingly, only 967 establishments were designated as active happened by chance to be the one discovered in 1989, only 297 of which began produc­ that was inactive the year before, while the one closed tion in 1989. The sharp decline of discoveries from had been previously active. The discovery of this 1988 appeared in part to reflect a drop in field staff churning led to a year-long study that in 1991 enthusiasm for updating due to preoccupation with identified about 5.5 percent of the 25000 ever-active preparations for the 1990 Population Census. establishments in the 1989 Directory as double-listed. In itself, double listing did DIAGRAM 2 : Age of Establishments Discovered, 1984-1992 not much affect the accura­ ~ 7,000 cy of Annual Survey tabula­ ~ tions, because both entries E •. 000 .s:; were seldom recorded as .!!! 5.000 :0 active at the same time (one l! 4.000 ~ being based on real data, LU "5 3,000 the other estimated as a Q:; 2,OOJ nonrespondent). However, .0 E 1.000 the doubles did clutter the ~ Directory and disturb the Z o CBS project for backcast­ ~ one y ... old 1:::;:;:;:::;:;:::;1 MO year. Of more ing synthetic histories for * 1992 data are preliminary and incomplete establishments missed 10 -- earlier years, and were, When 1984-89 discoveries were analyzed by cohort accordingly, purged from the Directory. In diagram (year starting commercial production). discoveries of 1, openings and closings are calculated on the basis of truly new establi shments were seen to have fluctuated a merged time series for each pair of doubles. sharply (dark block in diagram 2). In years of special efforts the number reached 800. In years of routine Second, field checks of 1988 closures showed that a efforts before 1988, the number never topped 135; few active establishments had been reported as closed. many establishments discovered had begun commerci­ Because closure reports were transmitted informally, al production some years before discovery. From the leaving no paper trail, responsibility for this mistake cohort analysis and analysis of the 1988-89fluctuation could not be assigned. The inverse error also took in discoveries, CBS concluded that the key to solving place. That is, newly closed establishments were the coverage problem was to devise a procedure satis­ sometimes treated as active non respondents for a year fying two requirements: or more after closure and inputed during Annual Survey tabulation. This error was impossible to trace * The procedure should discover most new because active non respondents were not positively establishments in the year they begin product­ designated: rather. they were a residual set. ion. or at most one year afterwards. * The procedure should operate year-in year-out F. Software for updating. Some problems with the old with equal effectiveness regardless of staff Directory updating system can be traced to software enthusiasm. limitations. Before 1988, all Directory updates were entered into the CBS mainframe; listings were sent as

75 hardcopy to th e provinces for di stribution to districts. CBS. Provincial statistical offices match oth er agency Because the procedure for transmitting Directory li sts with an alphabetized Directory ; unmatched names corrections from di stricts to provinces and thence to are designated "candidates," sorted by district, and sent the head office was cumbersome and ill-defined, field to districts. District offices similarly match other staff was often surprised by di screpancies appearing in agency lists; unmatched names not present in th e pro­ next year's Directory. On the hard copy, establish­ vincial list of candidates are designated additional ments were ranked by area and SIC; no alphabetical "candidates." All candidates are sorted and given to li stings were available. These procedures sometimes enumerators for field checking. made it difficult for staff to check whether an establishment was already listed or not. The target number of candidates was set at 60 percent of the active Directory for areas implementing match­ In 1988, in the context of administrative decentral­ ing for the first time, and 35 percent for those ization, CBS provided statistical offices in each of implementing it for a subsequent year. If the initial Indonesia's 27 provinces with software (using an over­ number of candidates is below target, supervisors are lay on DBASE3) for updating their own Direc tory. told to add lists from other agencies. If, however, the The software opened a channel for reporting the initial number of candidates is above target, super­ existence of new nonrespondents. However, it lacked visors are told to discard certain low-priority groups of summary tables and frequently failed to function due candidates, such as establishments below or slightly to viruses, technical misunderstandings and long com­ above the 20-worker threshold or unincorporated ones munication lags with CBS. Provinces updated their in subsectors usual! y dominated by small industry Directories inaccurately and tardily, because they (e.g.,tofu and tempe) . Supervisors are told to review lacked procedures for checking Directory accuracy and each year the "producti vity" of each source (agency felt they were doing the task for the head offi ce not list) and give preference to more productive ones. for themselves . Consequently, head office staff was obliged to edit provincial di skettes to assure consis­ Field staff are encouraged spontaneously to report tency with the Annual Survey, returning diskettes to new/mi ssed factories directly observed in the fi eld but provinces for use the following year. For ex ample, not deri ved from matching. Supervisors, however, are because provinces sometimes sent questionnaires for told to treat a high share of direct observation in a new factories but failed to add them to their Dir­ di strict as an indicator that matching may need ectories, head office staff added these new names. In improvement, because only good matching can provide the course of editing, some new mi stakes such as new management with the tool to guarantee consistent doubles inevitably occurred. Some corrections con­ updating results independent of flu ctuations 10 veyed to the head office by letter or word of mouth enumerator enthusiasm. were ignored in editing for lack of standard proce­ dures. A vicious cycle arose whereby the provinces B. Field checking. Field checking of candidates is complained of inaccurate CBS editing and absolved done with a standard form (l-B) that was pilot tested themselves of responsibility for a clean Directory. for two years. It requires the enumerator to check one of 9 findings that can be divided into three groups: III. The new system, 1990-92 1. Establishments engaged 10 conunercial Faced with the need more closely to monitor production, with 20 or more workers during the Indonesia's rapid industrial growth, CBS decided in survey year. These establishments will be October 1990 to develop anew, integrated Directory added to the Directory unless found to updating system. The system was implemented in duplicate ones already in it. stages, with compl ete nationwide implementation 2. Three codes for establishments not yet engaged beginning in calendar 1993 for survey year 1992. in conunercial production but needing to be Diagrams 3-4 depict its major elements. rechecked the next year. This includes factories in trial production, factori es under construction, A. Matching. A standard procedure was developed and vacant lots with a signboard indicating that for annual Directory updating, based on nationwide a factory will be built there. matching with establishment li sts of other agencies to 3. Five codes for establishments not fulfilling sel ect a list of candidates for fi eld checking. To conditions for the Directory and not needing to assure consistent updating efforts from year to year, be rechecked the nex t year. This includes small CBS assigns an annual target number of candidates to establishments, ones located in another di strict, each province. Matching is mainly carried on at two non-manufacturing ones, ones that once existed levels, provincial and di strict, with limited matching at but are now closed, and candidates that cannot

76 be located. Nonactive establishments, all of which the old soft­

ware had designated as "closed, If are now designated For candidates in the first group, enumerators collect with three codes: Closed, small and obsolete. data for main product, employment, and the year Obsolete includes three groups of drop-outs: Doubles, starting commercial production from either the estab­ mergers, and establishments which bad been added lishment itself or (for uncooperative establishments) during updating but tum out not to qualify for the guards or neighbors. For all candidates, enumerators Directory upon administration of the Annual Survey. fill out a form and receive a small payment. Super­ Despite safeguards in the new system, a few doubles visors check whether candidates in the first group are were expected to continue to appear. However, the already in the Directory. Provinces enter data for all use of form II-B was expected to automatically lead to candidates in a database using uni form CBS software, all doubles receiving an "obsolete" code. To minimize which transfers successful candidates to the Directory doubles the rule for assigning identification numbers and prints lists of candidates that need/don' t need to to new establishments was changed. Starting in 1991, be rechecked the next year. the ID was based on the originally reported SIC, whether or not it subsequently changed. Previously it was based on the current SIC, DIAGRAM 3 : Annual Directory Updating Cycle so that a change in main product (or recoding) forced staff to "close" an I-A Directory 1992 Matching establishment and "open" a new one, The (.orted alphabeti

77 shipments data. were new and 19 percent were one year old. For 1991, when all Java experienced systematic updating, Simultaneously, provinces were given full responsibility regional differences in the age composition of disco­ for Directory updating. CBS pledged it would never veries may in part be due to real differences in growth again edit provincial Directories, although it would patterns. For example, most Botabek growth is due to check them for quality and provide hard copy new (green-field) factories, whereas much growth in feedback. the older Jakarta area reflects incremental growth at smaller, older factories. DIAGRAM 4: Timing and Interrelationship of Main Field Activities The number of disco­ I-A Preliminary veries of newly-corn­ Diree­ updot. to,,! m e rcial establish­ ments in Java in 1991 (905) is unpreceden­ I-B Sl.nIeyof tedly large. It is cendidate. equal to 6.7 percent of the number of ac- II·A tiveestablishments for Annual Survey L ______~ I-+-j~ Pick up ql.astionneire questionneire. questionnaire L=':==::;:'::::::.J Java in 1990 (13,500), which compares rea­ sonably well with our II·B Short form lor nonreaponae presumption, based end ncvvly nonactive on fragmentary evi­ Mer. Apr. May June Ju~ Aug. Sept. oot. Nov. Nov. Dec. Jan. Feb. dence, that the true annual number of IV. Pilot results, 1990-91 new establishments may be about 10 percent of the number of active establishments. In fact, the 1991 A. Discoveries. The system for discovering new estab­ measure may even be more complete than appears at li shments was tested in 10 industrial di stricts of Ja­ first glance, if allowance is made for establishments karta and West Java in survey year 1990 and through­ starting production in 1991 but not yet qualifying for out the island of Java (with 75 percent of manufactur­ the Directory because their employment is still less ing) in 1991. Results indicate that the system reliably than 20. Most 1991 I-B di scoveries were found turns up many new or one-year-o ld establishments. In through matching. The 22 percent found by direct its first year of operation in any area, matching can be observation constitute a reasonable share, although expected to turn up many establishments that were too high in a few districts. Enumerators have gained previously mi ssed; such delayed di scoveries will pre­ a new awareness that CBS expects zero undercoverage sumably decline in subsequent years. As seen in dia­ and show a new enthusiasm about reporting new or gram 5, matching in its first year in all areas has mi ssed establishments. shown a jump in the number of discoveri es and, usual­ ly, in the ratio of new establishments to total di sco­ The average 1991 di scovery had 107 workers, much veries. Moreover, for areas subj ected to matching smaller than the 161 workers at the average estab­ over several years, there is some tendency for the lishmen t in the 1990 Directory. Establishments di s­ latter ratio to ri se -- an indicator of shrinkage the pool covered in their first year of commercial production of mi ssed establishments. Jakarta, which experienced tended to be about a third larger than ones discovered a pretest of a matching system in 19 88, showed after two or more years of commercial production. improvement in 1990and further improvement (in the ratio) in 199 1, when 28 percent of di scoveri es were B. Process of di scovery. Tables in the software sent new establishments and another 28 percent were only to each province enable them to evaluate their own one year old. The fast-growing Botabek suburbs, updating efforts and provide insights into the discovery which also joined the 1988 pretest, showed sharp im­ process. Total di scoveries in Java (purged of fal se provement in 1990 and again in 1991, when 73 percent ones, di scussed below), 2400,were equal to 39 percent of discoveri es were new. The city and di strict of of the 5950 candidates checked. Of the 61 percent Bandung, which first matched in 1990, showed a big that failed to qualify, 690, or II percent of candidates, improvement in 1991 , when 50 percent of di scoveri es were slated for rechecking the next year because they were new. For the rest of Java, 1991 was the first were found to be in trial production, under construc­ year of systematic updating: 36 percent of di scoveries ti on, or holding a vacant lot and signboard.

78 The success rate (di scoveries as a percent of candi­ later in the year because they turned out to be double dates) varied from 15 to 60 percent in industria l di s­ or small. (False di scoveri es are not included in the tri cts and even more widely in nonindustrial ones. data underlying diagrams 1, 2 and 5). Supervi sors The va riation refl ects district variations in the skills of have been asked to tackl e thi s problem in two ways: CBS offi cials in selecting candidates, the quality of other agency lists, and underlying (and unknowable) • Many doubles go by the same name and can real factors such as true growth rates, the backlog of rather easily be avoided if provincial and district mi ssed establishments, and (inversely) the ratio of the supervisors will merel y insist on careful target to the number of factories awaiting di scovery. cross-checking with the existing Directory. Some doubles go by different names or DIAG RAM 5 : Age of Establishments Discovered addresses and require careful checking at the 1984-1992, by Reg ion ooo r---~~------~~--~=------' enumerator level. Jakarta Proper • Borderline small factories in seasonal industri es 600 * 400 (e.g. ,garments) may report 20 or more workers on the I-B then report fewer than 20 on the "'" II -A long form . For such industri es, 0 600 di screpancies can be avoided by asking I-B 500 respondents to fi ll out a monthly employment -e'" 400 Q) worksheet like the one in the II-A. .,E :>Xl .!;;;"'" E .00 for recording Annual Survey questionnaire receipts ~ 3.seII but few used the one for recording shipments to CBS. 3.000 2.500 Rapid acceptance of the new software has been 2.000 supported by three fa ctors: ' .500 '.000sao CBS staff keeps in close contact with provincial o~~~==~~~~~~~~~ * '."'"'.000 offices to resolve problems caused by viruses, 800 incompatible DOS, mi sunderstandings, etc. 600 400 • Provinces are asked to bring their diskettes to interprovincial meetings and send them to CBS "'"oU;~ ~!L~~~U at certain deadlines. Most provinces sent their _ new c:::J one year old [ill] two or more years old 1991 di skettes twice to CBS , in October 1992 * year of systematic updating (Nae: 1992 dota are preirrrlary

79 * Questi onnaires with name, add ress and ID large number of newly nonacti ve establishments: 3120, consistent with those in the Directory are or 18.8 percent of the previous year's Directory. merely logged in. Preliminary findings show: * Questionnaires with mi ssing or di screpant ID are logged in and ID numbers are entered or * The number of newly closed (1790) and newly corrected . small (620) is well above the rate for a normal * Questionnaires from estab li shments not in the year (about \000 closures and a few hundred Directory are held to await updated provincial newly small), and, as a joint percentage (14. 8 Directories. percent), exceeds the 13-percent rate in two previous peak years, 1985 and 1988. Many of As Provinces sent updated Directories on di skettes, the cl osures (690) occurred in Jakarta province, the receiving offi cer merged them w ith the receipts where they equall ed an extraordinary 26 percent data already logged in , and resumed receiving. He of the number of previously acti ve establish­ recorded receipt of 13 ,500questi onnaires for the 199 1 ments. l akarta stat isti ca l officials attribute the survey, providing the Industry Division, for th e first fl ood of closures to form JI-B , which forced time ever, with an electronic checkli st of which fi eld staff to report closures overlooked in questi onnaires had been received. At the end of the previous years. This hypoth esis is supported by survey year, 38 unresolved di screpancies were found: tabulations showin g th at, among 1991 Jakarta 13 establi shments that appeared active in the closures, 69 percent did not complete Annual Directory but were in reality "nonacti ve: small, "and 25 Survey questionn aires in 1990, and 37 percent new establishments that had not yet been entered by had not done so during 1988-90. provinces. Moreover, the receiving officer was obliged * The number of newly obsolete, 700, is legiti­ to personally update the Directory for one small mate but startlingly large and due to two fac tors province with little industry. These di screpancies are that are being explored in a CBS study of 600 trivial compared to previous years, when the head newly obsolete establi shments in Java. First, office entered hundreds of new estab lishments and enumerators identifie<.l 77 doubles missed in the corrected acti vity status for hundreds more. The new 1989 doubles study, and 83 that were added to system has thus succeeded fully in shifting updating the 1990 Directory. Second, enumerators iden­ responsibility to provinces and eliminat ing the creati on tified 339 199 1 di scoveri es as false ones, of of doubles at the head office. which 243 turned out to be double, and another 96 were discarded for other reasons. Of the E. Closures and non respondents. The system for 243 doubles, 133, over half, cropped up in positively reporting closures and noorespondents w ith Central Java. Preliminary indicati ons are that form I1 -B, first tested in survey year 1991 , succeeded over half of these doubles were not discovered in "closing the set" of active establi shments; almost all in the new updat in g procedure, with fonn I-B, nonrespondents in lava were positi vely confirmed . but were entered directl y into the Directory. The overall nati onal nonresponse rate was onl y 17 This happened when districts sent provinces percent of establishments. Considering the negati ve Annual Survey questi onnai res (II-A) with att itude of many establi shments toward surveys, thi s is mi ssing or outdated lD numbers (BPS reassign­ great testimony to the perserverence of CBS field staff ed lD's in 1991). Provinces tried to match the assigned individually to each of 3500 sub-districts. establishments by name but sometimes failed, as for establishments with multiple names. Field staff needs additional training in the use of form Stymied, provinces then assumed the II-A's IJ-B, to minimize tardy and inaccurate reporting of were for new di scoveries, instead of returning closures. A study has been launched to "score" the them to di stricts for more posi ti ve identification accuracy with which enumerators fill ed in form II-B in as they should have done. 1991. Preliminary results show that the month of closure was not reported for a large share of closures; V. Preliminary national results, 1992 for many of these the year of closure reported , 1991 , is merely the survey year and not the actual year of Preliminary results for 1992,shown in diagrams 2 and closure . Results also show that, due to a combination 5, are based on August 1993 data that remain highly of mi sunderstanding and oversight, di stri ct-level incomplete for some West Java di stricts (including the supervisors fail ed to check the closure of man y large Bandung area) and 7 remote provinces outside lava. establishments, as required by form II -B. Desp ite thi s, the expected surg e is seen in discoveries outside lava, where systematic matching was applied The big surprise in 199 1 was the unprecedentedly for the first time.

80 A remarkable feature of the preliminary 1992 data is The 1992 experience shows that the integrity and that finns discovered in the first year of production in timeliness of the updating system cannot be taken for Java fell sharnly from 905 in 1991 to 542 in 1992. The granted but can ordy be guaranteed through continu­ latter figure is unlikely to rise above 600 even when ing attention to the details involved. This requires West Java returns are complete. It is tempting to intensive communication between the head office, speculate that the decline reflects a 1992 slowdown in provinces and districts, by visit, circular letter, industrial growth, related to tight money policy. A telephone and meeting. It al so makes heavy demands decline in new factories would be consistent with the on the time of the Manufacturing Statistics Division, observed sharp decline, starting in mid-1991, in and of provincial and di strict statistical offices. monthly project approvals by the Investment Board. VI. Summary However, the possibility cannot be excluded that the decline in discoveries of new establishments partly Indonesia's rapid industrial growth has obliged CBS to reflects as well a decline in the number of candidates tackle the difficult problem of annually updating its that were field checked during Directory updating in manufacturing Directory to keep pace with the Java, from 5950 in 1991 to about 4000 in 1992. The appearance of new factories. The new CBS Directory latter decline is due to three factors: the use of lower. updating system was developed after piecemeal second-year targets for East and Central Java, further improvements were tried, leading to often frustrating, adjustments to targets for budgeting reasons, and diffi­ trial-and-error, learning. The new system makes culty in finding enough candidates to fill the target in integrated, mutually-supporting use of user-friendly, Jakarta and Central Java. The difficulty in interpre­ management-oriented software, two new field instru­ ting the 1992 data draws attention to the need for ments (forms I-B and II-B), and systematic matching consistency and appropriateness in target determina­ with other agency li sts. By these means, the system tion and for studies of the impact on di scoveries of enables most new establishments to be quickly entered fluctuations in the number of candidates. into the Directory, while all closures and nonres­ pondents are positively identified. The field instru­ An interesting feature of the results is that when 1992 ments aRd software provide many checks and balances discoveries of establishments in Java in their second to prevent errors and assist management to detect and year of commercial production (263) are added to correct them when they occur. Provincial statistical 1991 di scoveries of first-year establishments (905), the offices find it convenient promptly to update their total (1168) is equal to 8.6 percent of the 1990 Directories and share printouts with district offices. Directory for Java -- surprisingly close to the Provincial offices al so find themselves saddled with presumed 10 percent rate of appearance of new some of the perplexing coordination and supervision establishments that was mentioned earlier. problems that previously found their way to the head office. The head office plans to provide regular feed­ Operationally, the 1992 survey year marked the first back to provinces to help them master the new tasks. time that the Manufacturing Statistics Division as­ signed a subdivision to the main task of supervising The new system can also be viewed in the context of Directory maintenance. Supervision focused on the 22 stati stical development in a developing country. The provinces outside Java, wh ere the new updating sys­ new system aims for a breakthrough to higher data tem was implemented for the first tirne. Time and quality by simultaneously tackling a tangle of insti­ funds were found for visits to 9 provinces outside Java, tutional obstacles. More specifically, the new system in some of which serious implementation flaws (inclu­ targets six obstacles to successful Directory updating: ding the omission of key steps in the updating pro­ The lack of a clear system of tasks and responsibili­ cess) were di scovered and corrected. By mid-August, ties, and the lack of performance indicators, of com­ 21 of 27 provinces had submitted the preliminary Dir­ muni cative software, of training, of funding, and of ectory di skette due July 1, some in response to tele­ confidence in the system by participants. However, phone prodding, and 18 had used the software module one remaining obstacle still handicaps the new system: for recording shipments of Annual Survey question­ a shortage of management time, day-in and day-out, naires to the head office. Analysis of the di skette data at national and provincial and di strict levels , to coach alerted the head office to implementation problems in participants in their tasks and to monitor and trouble­ several provinces, which triggered phone ca ll s and shoot performance flaws. CBS is trying to assign letters from the head office. To spur provinces to pay additional staff to the task, but is constrained by in­ more attention to quality, the head office has decided stitutional obstacles to resource reallocation. to take the unprecedented step of "scoring"the quality of responses to forms I-B and II -B. Although quantitative results for updating conform in

81 large part to our expectations and show great turing Wages. The MIS will provide a tool to help improvement over previous performance, the results management accelerate document fl ow and check data do not yet begin to provide a direct, reliabl e measure quality. Plans are also taking shape for creating an of growth in establishment numbers; the ex traordinary integrated directory of non-industrial businesses. number of closures reported in 1991 prevents that. As the new system continues to be implemented in a con­ The Indonesian Directory updating system would sistent manner, it is hoped that 1992-93 data may at appear to differ from the US Census Bureau's SSEL long last begin to provide measures of growth in in two respects. First, CBS cannot rely on matching establishment numbers, providing in the process criti ­ alone for updating, due to widespread deficiencies in cal input for adjusting the quarterly manufacturing other agency lists. That is, no other agency li st is survey for the influence of growth in establishment complete enough to serve as a definitive benchmark; numbers. As a foll ow-on project, CBS is developing all such lists constitute nothing more than input for a scheme for downloading provincial Directories to CBS examination. Second, CBS has abundant staff, so district statistical offices, for use in a management it can afford to fi eld check every "candidate" as the information system to monitor field work for three Census Bureau cannot. Indonesia' s workabl e system manufacturing surveys: The Annual Survey of Manu­ for directory updating may be sui table for use in many facturing, the Quarterly Survey of Manufacturing other developing/transiti onal countries. Production, and the Quarterly Survey of Manufac-

1. Fina l proof that enumerators had ollen ignored th e rules was not forthcoming until a "bac kcast" of estab lishments di scovered by th e Annual Survey some years after they began producti on revea led that over 40 percent of establish ments discovered in 1985 (with over 75 percent of employment at newly discovered establishments) began producti on before 1985 wi th 20 workers or more . That is, they were in-scope before 1985 but had been missed by enumerators.

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