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    Machinery and Equipment Price Index: Data Quality, Concepts and Methodology

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    The Machinery and Equipment Price Index (MEPI) measures price changes for annual additions to capital equipment purchases by industry. It calculates price indexes for 51 industries and 106 commodities based on manufacturers' selling prices. The weights used are derived from 1997 capital expenditure data and represent the value of capital investment that year. The MEPI uses a fixed-weight price index methodology with 1997 as the base year for both time and weights.

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    Machinery and Equipment Price Index: Data Quality, Concepts and Methodology

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    The Machinery and Equipment Price Index (MEPI) measures price changes for annual additions to capital equipment purchases by industry. It calculates price indexes for 51 industries and 106 commodities based on manufacturers' selling prices. The weights used are derived from 1997 capital expenditure data and represent the value of capital investment that year. The MEPI uses a fixed-weight price index methodology with 1997 as the base year for both time and weights.

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    The Machinery and Equipment Price Index (MEPI) measures price changes for annual additions to capital equipment purchases by industry. It calculates price indexes for 51 industries and 106 commodities based on manufacturers' selling prices. The weights used are derived from 1997 capital expenditure data and represent the value of capital investment that year. The MEPI uses a fixed-weight price index methodology with 1997 as the base year for both time and weights.

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    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    25 views3 pages

    Machinery and Equipment Price Index: Data Quality, Concepts and Methodology

    Uploaded by

    kaml
    The Machinery and Equipment Price Index (MEPI) measures price changes for annual additions to capital equipment purchases by industry. It calculates price indexes for 51 industries and 106 commodities based on manufacturers' selling prices. The weights used are derived from 1997 capital expenditure data and represent the value of capital investment that year. The MEPI uses a fixed-weight price index methodology with 1997 as the base year for both time and weights.

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    Data quality, concepts and methodology

    Machinery and Equipment Price Index


    (Tables 327-0041, 327-0042, 1997=100, quarterly, 1997 to present)
    Introduction
    The Machinery and Equipment Price Index (MEPI) measures price change for annual
    gross additions to capital for machinery and equipment by industry of purchase. Price
    indexes are calculated for industries, major groups of industries, and the total for all
    industries, and are also calculated for commodities. Price movement is measured on a
    domestic and an import basis.

    The industry and commodity designations used are those of the Input-Output Tables
    of the Canadian System of National Accounts. The classification system is the 1997
    North American Industry Classification System (NAICS).
    Industry total indexes are presented in table 8-1 ; commodity detail is presented in
    table 8-2.

    Characteristics
    Prices used
    Prices for domestic machinery and equipment are manufacturers selling prices f.o.b.
    plant on new orders as of the middle of the month.
    Prices for imported equipment are represented by the producer price indexes of the U. S.
    Bureau of Labor Statistics, and by a few price series from other foreign countries.
    Adjustments to price indexes
    Domestic and foreign price indexes are adjusted for changes in the effective rate of GST.
    The effective rate is the net GST tax (the tax levied on a commodity in a particular
    industry minus the rebated portion) divided by the value of the purchase. For most
    industries, the effective GST rate approaches zero per cent. Foreign price indexes are also
    adjusted for changes in exchange rates and custom tariffs where applicable.
    Derivation of weights

    The expenditure weights for the 51 industries and 106 commodities represent capital
    investment for the year 1997, valued at 1997 purchaser prices. They were derived
    from Input-Output data, which were themselves derived largely from the series of
    capital expenditure by industry, reported in the annual survey, Capital and Repair
    Expenditures, Actual, Preliminary Actual and Intentions (survey number 2803)
    Investment and Capital Stock Division.

    In general, below the commodity level of detail, equal weights were assigned to
    component indexes.
    Index formula
    From 1997 forward, the MEPI series are fixed-weighted price indexes of the general type
    described in the introduction to this catalogue, with both the time and weight base being
    1997.
    Revisions
    The most recent four quarters are subject to revision.
    Historical data
    Historical 1971=100 quarterly series are publicly available on CANSIM in tables 3270021, 327-0022 and 327-0023.
    Historical 1986=100 quarterly series are publicly available on CANSIM in tables 3270013, 327-0014 and 327-0016.
    Reference Documents
    Catalogue 62-552-XPB; Machinery and Equipment Price
    Indexes by Industry of Purchase, 1971-1979
    For Further Reading
    National income and expenditure accounts, quarterly,
    13-001-XIB, XPB
    Gross domestic product by industry, monthly, 15-001-XIE
    Private and public investment in Canada, intentions,
    annual, 61-205-XIE
    The input-output structure of the Canadian economy, 15-201 X1E
    Industry price indexes, monthly, 62-011-XIE, XPB
    For further information contact Client Services (613) 951-9606,
    Internet e-mail: [email protected]
    Prices Division, Statistics Canada, Ottawa, K1A 0T6.

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