Experience in Measuring Estimates of Russian GDP Dynamics Using Double Deflation Approach

Abstract

When constructing estimates of gross domestic product (GDP) and gross value added (GVA) at constant prices, three approaches or a combination of them are used: extrapolation, simple deflation and double deflation. The latter approach is considered preferable, but is not yet used in Russian statistics. The article is devoted to the issues of constructing estimates of GDP and GVA dynamics for the Russian Federation using double deflation. The interest in constructing such estimates is due to the possibility of taking into account the dependence of production on domestic and import supplies, which the other two approaches lack. Received for the period from 2011 to 2016 estimates were compared with official indicators for the overall economy, the service sector, and for mining and manufacturing.From 2011 to 2016 alternative estimates of the physical volume indices of GDP and GVA showed lower growth rates compared to official indicators. This is due to the faster growth of alternative estimates of intermediate consumption compared to official ones. In the structure of intermediate consumption, domestic intermediate products were replacing imported analogues. The current dynamics of indicators, to a first approximation, shows signs of localization of production, which may be associated with the transition of enterprises to domestic outsourcing and the implementation of an import substitution policy.At the same time, the presence of measurement problems in the use of double deflation is obvious, most clearly manifested when moving to the analysis of indicators of lower levels of aggregation. The analysis shows in favor of conducting additional research related to the introduction of the double deflation technique in the official methodology.