Stats NZ has a new website.

For new releases go to

www.stats.govt.nz

As we transition to our new site, you'll still find some Stats NZ information here on this archive site.

  • Share this page to Facebook
  • Share this page to Twitter
  • Share this page to Google+
Regional GDP glossary

Regional GDP scope

Current prices

Statistics NZ’s regional gross domestic product (GDP) estimates are presented in current prices. Current (or nominal) price GDP measures production in the prices prevailing at the time. This means inflation (price effect) is not removed.

Gross domestic product (GDP)

Total market value of goods and services produced in a given area, minus the cost of goods and services used in the production process.

Production approach to GDP

This is one of the three approaches of measuring GDP. This approach derives the total value added of producers by deducting the value of goods and services used up in production from the value of goods and services produced. This is the approach used for deriving regional GDP statistics by Statistics NZ.

top

Data sources

Annual Enterprise Survey (AES)

This annual survey collects national level economic information by industry, including measures of financial performance and financial position. The target population for AES is all economically significant businesses operating in New Zealand, though with some industries excluded. Around 90 percent of GDP production is covered. AES has been selected as the core data source for compiling regional GDP.

Business Frame (BF)

A database of all known individual private and public sector businesses and organisations engaged in the production of goods and services in New Zealand that meet economic significance criteria. Business Frame data contributes to other data sources that may be used in the estimation of regional GDP.

Linked Employer–Employee Data (LEED)

An integration project that brings together the Inland Revenue administrative data with Statistics NZ’s Business Frame data, to provide employment statistics by industry and region. While data compiled from LEED covers only one component of GDP – compensation of employees – it can be useful to test how AES modelling is performing and as a data source for estimating industry GDP in regions where there are gaps in AES.

top

Methodology approaches

Bottom-up (direct measure)

The internationally preferred approach for regional GDP compilation is to directly measure the local activity of enterprises, and build up regional accounts from this information. The enterprise-level approach is preferred as it directly measures value added. It is also useful analytically as it clearly links the activity of enterprises within a region to the overall economic performance of the region. The New Zealand regional GDP statistics are compiled using this approach where possible, which is for most industries. The main alternative to the bottom-up approach is thetop-down (or indirect) approach.

Residency

The residency approach to regional GDP is based on the physical and legal existence of a unit in a region. It allocates value added to the region where the production unit is resident. This is important where a unit creates value added in more than one region, but is based only in one region. One such example is a transport business that provides services outside of its resident region, but its capital and employees are based in the resident region. Where a unit creates considerable value added in more than one region the territory principle is applied in place of the residency principle, and allocates proportions of the unit’s value added to the regions where the activity takes place.

Territory

The territory concept allocates activity to the region where it takes place, reflecting the activity of labour and capital operating in a region regardless of where the ‘owning’ production unit is located. This is applied where a unit’s workers are employed in more than one region, or when a unit owns considerable capital in a region that is different to the unit’s resident region, such as a power company based in one region, who owns a hydro-electric power station in another region.

Top-down (indirect measure)

This method allocates national level GDP to regions using a variable with a regional correlation to GDP, for example employment numbers or wages paid. The method is named top-down because the variable is allocated to a region not to a local unit. While top-down can be easier to implement than the bottom-up method, the accuracy may be harder to assess. It implies additional assumptions about the homogeneity of regions, for example, that pay rates are the same in every region, or the amount of capital per worker is the same in every region.

top

Statistical units

Enterprise

A business or service entity operating in New Zealand, including a company, partnership, trust, estate, incorporated society, producer board, local or central government organisation, voluntary organisation, or self- employed individual. An enterprise makes financing and distributive decisions on behalf of its group of firms. It can operate at one or several locations.

Geographic unit (GEO)

A separate operating unit engaged in one or predominantly one kind of economic activity, from a single physical location or base in New Zealand. It can be classified to industry and region but has no or limited financial data available.

Industry

A group of establishments engaged in the same or similar kinds of activity. Statistics NZ uses ANZSIC 2006  for compiling and presenting industry statistics. The level of detail provided is expected to be similar to the regional GDP statistics released in 2006, available from Regional GDP feasibility study.

Kind of activity unit (KAU)

A subdivision of an enterprise producing goods and services, with a single set of accounting records. This can be classified to industry, and is the usual basis of financial information used in compiling regional GDP.

Local kind of activity (LKAU)

A notional unit established for the purpose of compiling regional GDP. It can be classified to industry and region. Transactional information can be imputed or can be estimated from a ‘regionalisation’ of KAU data.

Statistical unit

The entity for which statistics are stored, produced and published. These are used to recognise units that make production or financial decisions and to collect this information from them. Statistics NZ statistical unit structure comprises three levels: enterprise/ kind-of-activity/ geographic units.

top

Classifications

Australian and New Zealand Standard Industry Classification 2006 (ANZSIC 2006)

This is the official industrial classification used by Statistics NZ. The classification system aims to reflect the structure of Australian and New Zealand industries and enable comparability with other countries’ statistics. The regional GDP project uses the 2006 version of the ANZSIC classification, whereas the regional GDP data series published in 2006 used the ANZSIC 1996 industrial classification system.

Regions

The regional breakdown is based on regional council administrative boundaries. Tasman and Nelson have been combined due to difficulties in assuring the correct differentiation of economic activity between the regions. The published regions consist of:

  • Northland 
  • Auckland 
  • Waikato 
  • Bay of Plenty 
  • Gisborne 
  • Hawke's Bay
  • Taranaki
  • Manawatu–Wanganui 
  • Wellington
  • Nelson and Tasman
  • Marlborough
  • Canterbury 
  • West Coast 
  • Otago 
  • Southland

Page updated 7 May 2013

  • Share this page to Facebook
  • Share this page to Twitter
  • Share this page to Google+
Top
  • Share this page to Facebook
  • Share this page to Twitter
  • Share this page to Google+