1

UNITED NATIONS ECONOMIC COMMISSION FOR EUROPE CONFERENCE OF EUROPEAN STATISTICIANS Expert Meeting on Statistical Data Collection and Sources 22-24 May 2024, Geneva, Switzerland

15 April 2024

The European One-Stop-Shop for Artificial Intelligence and Machine Learning for Official Statistics (AIML4OS): WP9 Use Case focused on imputation

David Salgado & Sandra Barragán (Statistics Spain, Spain) [email protected] Abstract The European Statistical System has recently launched the innovation project One-Stop-Shop for Artificial Intelligence and Machine Learning for Official Statistics (AIML4OS), with the participation of 14 countries to develop innovative solutions with respect to statistical products and processes using different AI-ML techniques. The project comprises 6 cross-cutting and 7 use-case-oriented work packages, among which editing and imputation constitute two specific focuses of development. In this contribution we summarise the structure of Work Package 9 concentrating on imputation, with a close coordination with Work Package 8, focused on editing (understood as error and outlier detection). We share the structure of the work package seeking for business functions beyond error treatment and a clear orientation towards more timely and granular production of official statistics and the delivery of better responses to user needs. The main challenge is to scale up knowledge and experience from concrete national needs to general solutions to accrete European guidelines. This project shares the vocation to establish strong international collaborations and to push forward the community-building effort in Official Statistics, now especially needed in the new data and AI-ML ecosystem

Instituto Nacional de Estadística

New migration statistics after the birth of annual

censuses

Sandra Martín Mazo

Group of Experts on Migration Statistics, UNECE

May 2024

Index

New migration statistics

after the birth of annual censuses

I. Introduction

II. The Population Register in Spain

III. Objectives of the new migration statistics

IV. Methodology

V. Consistency with annual population censuses

VI. Planned improvements

2

I. Introduction

3

Census

2022

Census

2023

1 year 1 year

T R

A D

IT IO

N A

L

C O

M B

IN E

D

R E

G IS

T E

R -

B A

S E

D

Census

2011

Census

2001 Census

2021

10 years 10 years

SHIFT IN

DEMOGRAPHIC

STATISTICS

Inter-census

estimates

II. The Population Register in Spain

4

MONTHLY

UPDATE

~ 8,000

Municipal

Registers

✓ Residents are obliged to register (even if

they don’t have a residence permit)

Population Register Database

NSI (Instituto Nacional

de Estadística) →

coordinating body

Municipality

Municipality

Municipality

✓ Registration → Benefits: proof of residence,

social services, education, public health,

municipal services…

✓ De-registration → No benefits: Periodic

verification of residence and expiration policies

Migration and Changes of Residence Statistics

Geographical level:

✓ Autonomous communities

(NUTS2)

✓ Provinces (NUTS2 aprox.)

✓ Municipalities (LAU)

✓ More

Variables:

✓ Basic demographic variables:

sex, age, citizenship, country of

birth, place of origin / destination,

year and quarter of migration

✓ Others (education attainment,

work activity...)

Series:

✓ Foreign migration

(immigration / emigration)

✓ Internal migration (inter-

autonomous / inter-provincial /

inter-municipal migration / more)

✓ Complies with the Regulation 862/2007 on community statistics on

migration and international protection

5

III. Objectives

6

▪ DEATHS

▪ FOREIGN

EMIGRATION

▪ BIRTHS

▪ FOREIGN

IMMIGRATION

▪ = geographic scope

▪ ≠ geographic scope:

INTERNAL MIGRATION

Census

1-Jan-t

Census

1-Jan-(t+1)

Year t

COMMON

INFLOWS

IV. Methodology

Migration

Statistics

OUTFLOWS

IV. Methodology

7

Census

1-Jan-t

Census

1-Jan-(t+1)FOREIGN

IMMIGRATION

FOREIGN

EMIGRATION

INTERNAL

MIGRATIONS

V. Consistency with annual population censuses

8

• Delays in registrations / de-registrations →

migrations of the reference year

Theoretical

registrations 2018

Estimated

registrations 2018

Registed and occurred

in 2018 792.965 792.965

Delays (registrations in

2018 and occurred in

previous years)

2.929

Occurred in 2018 and

registered later 2.226

TOTAL 795.191 795.894

V. Consistency with annual population censuses

9

Population Register

stock

• Signs of life

Census

• Comparing two consecutive Migration

Statistics

• Not all entries or exits of the population are reflected in entries or exits records in the Population Register and, nevertheless, they are considered migrations (for consistency with the censuses).

Population Register

flows

VI. Planned improvements

10

✓ Higher geographical level

Infra-municipal level:

different areas of a city

Geo-referenced:

(as Censuses are

geo-referenced)

✓ Adding typical census variables

Educational attainment Labour market

variables

VI. Planned improvements

11

Thank you for

your attention!

[email protected]

12

*Prepared by Cristina Casaseca Polo and Sandra Martín Mazo. NOTE: The designations employed in this document do not imply the expression of any opinion whatsoever on the part of the Secretariat of the United Nations concerning the legal status of any country, territory, city or area or of its authorities, or concerning the delimitation of its frontiers or boundaries.

Economic Commission for Europe Conference of European Statisticians Group of Experts on Migration Statistics Geneva, Switzerland, 7−8 May 2024 Item 6 of the provisional agenda Improvements in use of administrative data for migration statistics

New migration statistics after the birth of annual censuses Note by Instituto Nacional de Estadística (INE, National Institute of Statistics) Spain *

Abstract The 2021 census in Spain has been based entirely, for the first time, on administrative sources. Its structure is that of the main source, the population register of Spain (Padrón), subsequently applying the signs of life method. This allows the process to be replicated each year to provide annual censuses.

In order to measure migration in a consistent way between every two consecutive censuses, a new migration statistics was created (EMCR, for Estadística de Migraciones y Cambios de Residencia), which provides the migratory flows that occurred during the year. Its methodology can be summarised in two steps: firstly, people who have left, entered or remained in the population are identified from the censuses and, secondly, all migratory movements of these people are sought in the population register.

The fact that censuses are an input for the construction of the EMCR will make it possible, in the near future, to easily obtain very rich information on migration, such as more geographic level (currently it has been constructed only up to the municipal level) or adding typical census variables (educational attainment, labour variables, etc.). This will result in a better understanding of the socio-demographic characteristics of migrants.

Working paper 10

Distr.: General 29 April 2024 English

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2

I. Introduction

1. Starting with the publication of the 2021 Population and Housing Censuses, on 30 November 2022, there was a paradigm shift in the demographic statistics, since the methodology used in constructing this census was based for the first time entirely on exploiting official administrative registers. Its structure is that of the main source, the Population Register of Spain, subsequently applying the signs of life method1. This makes it possible to replicate each year the process to provide annual population censuses (housing census will be less frequent).

2. Thus, from 2023, the regular production of the population census is established, which will be published at the end of each year with a reference date of 1 January2.

3. Between every two successive censuses, there is a population growth or decrease, which will be explained by the demographic components that occurred during the intervening year. These components are births, deaths and migrations.

4. To measure migrations in a consistent way between every two consecutive censuses, the Migration and Changes of Residence Statistics3 (EMCR, for the Spanish name: Estadística de Migraciones y Cambios de Residencia) was created, with data starting in 2021.

II. The Population Register in Spain

5. In Spain there is a Population Register, or Municipal Register, called Padrón, for each municipality (more than 8,000). It is coordinated and managed by the National Statistics Institute (INE).

6. All residents are obliged to register in the Padrón of the municipality where they live for most of the year, including people without legal residence or those registered in non- conventional dwellings. Furthermore, since the implementation more than 25 years ago of the Padrón as a continuous record (with monthly updates), it has matured greatly as a population register, establishing, among other things, procedures for expiration and periodic verification of the residence of foreigners that make it an updated, reliable and accurate population register.

7. The Municipal Register records various types of variations: registration and de-registration, which are, or may be associated, with a residential change, as well as a series of modifications. A significant part of these variations are recorded on the initiative of the person concerned and others are carried out ex officio by the municipal authority itself.

1 Population and Housing Census methodology, page 18: https://www.ine.es/censos2021/censos2021_meto.pdf Paper presented at UNECE Group of Experts on Population and Housing Censuses: https://unece.org/statistics/documents/2023/08/working-documents/general-overview-2021-register-based- census-spain 2 Only demographic variables will be disseminated at the end of the year. Other variables, such as educational or labour market ones, will be published in later editions. 3 Methodological details: https://ine.es/en/metodologia/meto_emcr_2023_en.pdf

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8. The fact that registration in the Municipal Register is required as a necessary condition for the exercise of very basic rights, such as health coverage, schooling or for the future obtaining of legal residence permits, means that the vast majority of the flow of immigration from abroad ends up being registered.

9. With regard to emigration abroad of Spaniards, the monthly comparison of the Population Register with the consular registration records abroad allows the emigration of Spaniards to be recorded, provided that they register with the corresponding consulate.

10. In the case of emigration of foreign citizens, there are few who order the de-registration in their municipality of residence at the time of their departure from Spain. However, the de- registration mechanism carried out ex officio in those cases of non-usual residence in the municipality or the implementation of the process of expiry of the registrations of non-EU foreigners in the register without a permanent residence permit, guarantees that the emigration abroad of foreign nationals not declared by the interested party in their municipality of residence, end, to a large extent, recorded in the Municipal Register, sooner or later.

11. For both Spaniards and foreign nationals, in addition, there is a process of "natural cleaning" of the registry, which occurs when new residents in a dwelling are registered, indicating that former residents must be de-registered.

III. Objectives of the new migration statistics

12. The purpose of the Migration and Changes of Residence Statistics is to provide, in each autonomous community (NUTS2), in each province (approximately NUTS2) and in each municipality (LAU), a quantitative measurement of the:

- Foreign migrations: migratory flows between Spain and abroad.

- Internal migrations: migratory flows that occur within Spain. Depending on the geographical area of origin and destination of the movement, be it an autonomous community, a province, or a municipality, we will talk about inter-autonomous, inter-provincial or inter-municipal migration.

13. The migration series will be disaggregated by sex, age, year of birth, country of citizenship, country of birth and origin and destination of migration, as well as year and quarter of movement.

14. In addition, it will continue to comply (as the previous migration statistics already did) with the European legislative framework governed by Regulation 862/2007 on community statistics on migration and international protection, which regulates the migratory movements of each country, adapting in turn to the future regulation that will replace it.

15. The geographical scope is the entire national territory, with disaggregation for its autonomous communities, provinces and municipalities.

IV. Methodology

16. The starting point to obtain the reference data for a given year from the Migration and Changes of Residence Statistics are the population censuses at the beginning and end of said

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year. The first will be the census on January 1 of the reference year, and the one at the end of the period will correspond to the census on January 1 of the following year4.

17. With the two censuses available, we compare which people were in one and not in the other, or are present in both. Those who were in the second census and not in the first one, constitute the entries into the population (which can be foreign immigrations or births), and in the opposite way we obtain the exits from the population (foreign emigrations and deaths).

Figure 1 Population in and outflows

18. Once it has been determined which people have entered or left the country, or remain in it, we go to the centralized base of the Municipal Register to retrieve their registry history, which will allow us to reconstruct their migratory history. Migration flows are thus determined as follows:

19. Foreign immigrations: When we search the municipal register database for entries in the population, which are consistent with the two successive population censuses at the beginning and end of the year, we can distinguish the way in which these people entered the population, thus determining immigration abroad. In summary, foreign immigration will be made up of those people who are not in the census at the beginning of the year and are in the census at the beginning of the following year, and who were not born in the reference year.

4 The dates of December 31 at the end of the day and January 1 at the beginning of the day are considered equivalent.

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20. Foreign emigrations: Similarly, when we search the Municipal Register database for population exits, we can distinguish the way in which these people left the population, thus determining foreign emigration. In summary, out-migration consist of persons who are in the census at the beginning of the year and are not in the census at the beginning of the following year, and who have not died in the reference year.

Internal migrations: The domestic migrations of a given year of the people who are in one or another population census are formed by joining all the changes of municipality that occurred between:

- The movement of entry into the population and the census at the end of the year.

- The census at the beginning of the year and the exit movement of the population.

- The two censuses.

Figure 2 Foreign and domestic migrations

21. On the other hand, it should be noted that the only types of registry variation in which the

country of origin or destination is available are those declared by the citizen. Therefore, these variables will contain an “Unknown” category, which is particularly large in out- migration.

V. Consistency between annual population censuses and EMCR

22. As mentioned previously, the EMCR was created with the objective of being consistent with the annual censuses, necessary for correct demographic analysis. Therefore, there are several elements to take into account:

23. Migratory movements in a population registry such as the Padrón can be reflected with a delay, even of several years, although it is usually only a few months. But censuses

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6

(stocks) consider all resident persons on a reference date, regardless of the delay in their registration. The coherence between population and migration statistics obliges us to include these delays in the migration data of a certain reference year, and is a consequence of prioritising stocks over flows.

Graph 1 2021 registrations

24. Furthermore, considering movements from previous periods as occurring in the reference

year approximately alleviates the deficit of movements that we cannot include because they will arrive later. In other words, it is a better estimate of the migratory flows that occurred in a year, instead of only taking those that have a recorded date of occurrence in that year at the time of compiling the statistics.

Table 1 Estimation of 2018 registrations

Theoretical registrations 2018

Estimated registrations 2018

Registered and occurred in 2018 792,965 792,965

Delays (registrations in 2018 and occurred in previous years) 2,929

Occurred in 2018 and registered later 2,226

TOTAL 795,191 795,894

0.00%

0.02%

0.04%

0.06%

0.08%

0.10%

0.12%

0.14%

0.16%

0.18%

19 97

19 98

19 99

20 00

20 01

20 02

20 03

20 04

20 05

20 06

20 07

20 08

20 09

20 10

20 11

20 12

20 13

20 14

20 15

20 16

20 17

20 18

20 19

20 20

Year of occurrence

2021 registrations

Occurred in 2021 --> 99.5%

Occurred in 2020 or before --> 0.5%

NOTE: For the purposes of the EMCR, where records are assessed about six months after the reference year.

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7

25. Some persons have been counted or not in the censuses by the signs of life method, that is, by searching for them in other administrative registers. In this way, not all entries or exits of the population are reflected in entries or exits in the Padrón and, nevertheless, for consistency with the censuses, they are considered migrations.

VI. Planned improvements

26. The improvements envisaged are related to the possibility of extracting information from the population censuses, given the coherence between both operations.

27. In a given year, t, foreign immigration (and all possible subsequent domestic migrations) can be linked with the census at the end of that year; foreign emigration (and all the possible previous domestic migrations) with the census at the beginning of the year; and finally, domestic migrations of persons who were in both censuses, can be linked with both censuses, as shown in the following figure:

Figure 3 Migrations and census information

28. The main examples are:

29. (1) The geographical level is susceptible to being extended below the municipal level. Initially, the statistics are proposed with a municipal breakdown, but will be able to offer results for movements of an infra-municipal nature. Hence the denomination of "migrations and changes of residence" insofar as infra-municipal movements are considered changes of residence rather than migratory movements. Since the population is geo-referenced in the census, we can also geo-reference the EMCR. Mobility studies between different areas of a city, for example, are particularly interesting.

30. (2) The fact that it is fully consistent with the censuses will make it possible to add typical census classification variables (educational attainment, work activity, etc.).

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31. In the following graph we can see the foreign emigration in 20215, crossed by their level of studies in the 2021 census:

Graph 2 Educational attainment of 2021 emigrants

32. We can appreciate the difference between Spanish and foreign population in emigrations

abroad in 2021. We can see that most of the foreigners who emigrate do so with primary education or less, while most of Spaniards who emigrate abroad have higher education.

VII. Conclusions

33. This has been a major change, which was made necessary by the implementation of the annual censuses.

34. Consistency with annual population censuses allows for an explanation of population change through demographic phenomena, which is also very useful for making population projections based on assumptions about such phenomena.

35. The improvements envisaged are promising, and open up a path of analysis and knowledge of the socio-demographic characteristics of migrants that has been impossible until now.

5 At the time of writing this paper, only the education variables of the 2021 census were available.

16%

24% 23%

37%37%

18% 21%

25%

0%

5%

10%

15%

20%

25%

30%

35%

40%

Primary education and below

First stage of secondary education

and similar

Second stage of secondary education and non-higher post- secondary education

Higher Education

Educational attainment of 2021 emigrants

Spaniards Foreigners

1

UNITED NATIONS ECONOMIC COMMISSION FOR EUROPE CONFERENCE OF EUROPEAN STATISTICIANS Expert Meeting on Statistical Data Collection and Sources 22-24 May 2024, Geneva, Switzerland

19 April 2024

EXPERIENCE ON MULTIMODE DATA COLLECTION IN THE NSI SPAIN. CHALLENGES AND OPPORTUNITIES

Francisco Hernández Jiménez (INE Spain, Spain) [email protected] Abstract The continuous evolution of society, together with the constant technological changes and the necessary optimization of costs, allow to conclude that the right approach to household surveys must consider a multimode data collection, prioritizing the most inexpensive modes. This paper shows the evolution of multimode data collection in recent years at INE Spain. Due to cost issues, we start with the CAWI mode, having greatly increased its response rates through telephone incentivization. Then, without closing the CAWI mode, the CATI mode is opened, having a contact telephone number for most households. Finally, a residual data collection is carried out by CAPI, previously guaranteeing that the units have been sufficiently worked in the other two modes. All of this requires a sufficiently flexible data collection tool. In this paper, the example of a survey is developed in which in the last decade there has been a shift from a fully CAPI collection to one in which the units collected by CAPI represent only the 16% of the effective sample.

Economic Commission for Europe Conference of European Statisticians Group of Experts on National Accounts Twenty-third session Geneva, 23-25 April 2024 Item 2 (b) of the provisional agenda Towards the 2025 System of National Accounts: Measuring intangible assets and natural capital in 2025 System of National Accounts

Measuring intangible assets in the Spanish economy - Marketing assets

Prepared by National Statistical Institute of Spain 1

Summary

Growth and productivity analysis models based on production factors (labour and capital) require the incorporation of all existing forms of capital, both tangible and intangible, which underscores the interest in such estimations. Intangible assets are well identified in economic literature. An essential subset of intangible assets resides within marketing products, encompassing brand names, trademarks, logos and digital domains. While the recommendation to recognize marketing assets as produced assets was not agreed for inclusion in the sequence of economic accounts in the 2025 System of National Accounts, the countries with significant marketing assets are encouraged to compile extended accounts with marketing assets treated as produced assets in order to facilitate further research and analytical purposes.

National Statistical Institute of Spain has taken proactive strides in this respect. The ongoing research delves into exploring diverse sources and estimation methodologies to quantify the flows and stocks associated with these intangible assets. This initiative aims to develop implementation protocols that can effectively provide estimates of marketing assets. This paper presents the project's status, investigated sources and methods, initial preliminary results, and future lines of action.

1 Prepared by Sixto Muriel, Juan Cervigón and Teresa Ortiz, National Statistical Institute (INE) of

Spain.

United Nations ECE/CES/GE.20/2024/17

Economic and Social Council Distr.: General 27 March 2024 English only

ECE/CES/GE.20/2024/17

2

I. Background – Theoretical and conceptual framework

1. Marketing assets are a relevant part of the globalized economy. Companies invest large amounts of money to communicate to their potential customers ideas or concepts associated with their products that make them more attractive to differentiate themselves from the competition and increase their profits, either through an increase in unit margins, an increase of sales volume or a combination of both. Large multinational groups compete in international markets by making significant investments in marketing assets to advertise their products, differentiate them from other competitors, incorporate intangible value for the consumer and increase sales margins.

2. To do this, companies plan medium and long-term marketing strategies, which involve significant investments. The marketing products that result from these collect the commercial value of a company or a name.

3. Companies also try to protect their commercial position by registering their trade names and logos to ensure that no one can use them and therefore exclusivity in obtaining the benefits derived from investments in marketing assets.

4. It is relevant to note that the time horizon of use of these marketing products clearly exceeds one year. Brands, logos, and web domains are used and provide marketing services to companies for long periods of time, although it is true that they require permanent reinforcement so that potential customers maintain their memory effectively.

5. Therefore, marketing products meet the normally accepted criteria to qualify them as assets themselves: in national accounts terms, it is true that (i) a productive unit must make the decision to undertake the expenditure to produce the asset; (ii) there is a clear owner of the asset with exclusive rights of use; (iii) the asset provides capital services in the production chain of goods or services (2008 SNA 10.8 and 10.9.a).

6. However, marketing assets present some difficulties in their effective accounting as produced assets. These difficulties take shape in three aspects: the valuation of the asset, the consumption of the asset in the production process (and therefore the duration of the asset) and the volume of the stock (price index). To overcome such difficulties is necessary a common guidance for countries to evaluate marketing assets.

II. Marketing assets in the national accounts system

7. No common guidance exists for measuring marketing assets. Perhaps for this reason, until now it has been decided not to count marketing assets as produced assets in the system of national accounts. For it to be possible to account for marketing assets, it is necessary to establish a reasonable system shared by countries, sustainable over time and commonly used by all economies with the aim of maintaining the comparability of data between countries and over time.

8. Both the System of National Accounts (SNA 20082) - and, therefore, the European System of National and Regional Accounts 2010 (ESA 2010)3- and the current Balance of Payments and International Investment Position Manual (BPM64) coincide in classifying marketing assets as non-financial non-produced assets. For this reason, currently, investments in marketing assets made by companies are not counted in the capital account as gross fixed capital formation in the national accounts, but as intermediate consumption.

2 https://unstats.un.org/unsd/nationalaccount/docs/sna2008spanish.pdf 3 https://www.boe.es/doue/2013/174/L00001-00727.pdf 4https://www.imf.org/-/media/Websites/IMF/imported-publications-loe-

pdfs/external/spanish/pubs/ft/bop/2007/bopman6s.ashx

ECE/CES/GE.20/2024/17

3

9. Marketing assets are intangible assets. The 2008 SNA, unlike the 1993 SNA, also chooses not to define the category of intangible assets (SNA 10.67, A3.50 and A3.52.d )5.

10. Firstly, in the current standard, an asset is defined as “a store of value that generates a benefit or a series of benefits accruing to its economic owner from its possession or use during a period. It is a means that allows value to be transferred from one accounting period to another” (SNA 10.8).

11. Subsequently, assets are classified as financial and non-financial. Within non-financial assets, produced assets are those that have their origin as products of production processes included within the production boundary; and non-produced are those that have their origin in ways other than production (SNA 10.9).

12. In turn, non-financial assets produced are subdivided into (i) fixed assets, which are used repeatedly or continuously in production processes for more than one year, (ii) stocks of production intended for sale and (iii) valuable objects that are characterized more as a store of value than as productive capital (jewellery, works of art, precious stones and metals, etc.) (SNA 10.10).

13. The category of fixed assets includes all tangible assets (buildings, infrastructure, machinery, etc.), as well as the following intangible assets, referred to in the manual as intellectual property products (SNA 10.98).

• Software and databases.

• R&D.

• Mining exploration and evaluation.

• Original for recreation, literary or artistic.

14. The SNA 2008 does not recognize any other intangible assets as fixed assets.

15. On the other hand, non-produced non-financial assets are classified into three categories (SNA 10.14):

• Natural resources.

• Contracts, leases and licenses.

• Goodwill and marketing assets.

16. In particular, marketing assets “consist of items such as brand names, mastheads, trademarks, logos, and domain names. A brand can be interpreted as far more than just a corporate name or logo. It is the overall impression a customer or potential customer gains from their experience with the company and its products.” SNA (10.198)

17. These assets are only recorded when a sale or purchase of a company or one of those assets takes place (SNA 10.17)6. That is, marketing assets are recorded in the system of accounts either when a company is purchased and sold, together with the goodwill, and for a value equal to the difference between the price paid and the value of the assets, less the

5 10.67 The SNA does not formally include a division between tangible and intangible assets in the

classification. A3.50 In relation to the classification of assets, the 2008 SNA, like its predecessor, differentiates non-

financial assets and financial assets/liabilities at the first level of classification. In non-financial assets, it distinguishes between produced and non-produced assets. In the classification of produced and non- produced assets, there is no longer a distinction between tangible and intangible assets. In the 2008 SNA, non-produced assets are subdivided into three categories: natural resources; contracts, leases and licenses; and purchase and sale of goodwill and commercial assets.

A3.52.d The expression “intangible fixed assets” is modified by “intellectual property products”. The word “products” is included to specify that it does not include third-party rights that are non-produced assets in the SNA.

6 10.17 Goodwill and marketing assets represent all or part of the net value of an institutional unit. It is only recorded when a unit is acquired in its entirety or when an identifiable marketing asset is sold to another unit.

ECE/CES/GE.20/2024/17

4

company's liabilities, or when a sale of one of these marketing products occurs, valued at the purchase and sale price of the asset. Although their accounting can be relatively complex, the registration of this type of operations does not affect, with the current standard, any aggregate of the current accounts. It is recorded directly in the accumulation accounts as non-produced assets. (SNA 12.33).

18. That is, in the case of the sale and purchase of a company, the joint value of the goodwill and the marketing assets are calculated as a residual that, in addition, fulfils the function of absorbing the difference between the paid value and the net value of the company. If the marketing asset is the subject of an isolated sale, identical accounting treatment is provided (SNA 12.35).

19. The moment of registration of these flows is the moment of sale (SNA 12.34).

20. The 2008 SNA does not recognize the existence of any other type of intangible assets such as product design assets, specific training, or business organization.

21. However, it is not difficult to theoretically justify that marketing assets (or even the rest of the intangible assets) are fixed produced assets in the national accounts framework.

• They meet all the required characteristics to be a produced non-financial asset (SNA 10.8 and 10.9): it is a store of value, it generates benefits for its owner, and it is a product of a production process.

• Additionally, the asset is used repeatedly in the production process.

22. In short, there seems to be no theoretical reason not to consider marketing assets as fixed assets. In fact, the 2008 SNA itself explicitly recognizes that the difficulty of economically valuing marketing assets is the main reason for not having considered them, until now, as produced assets (2008 SNA, A4.53).

23. That is the vision that has motivated the discussion on the statistical recording of marketing assets in the research agenda of the SNA and the BPM, within which framework, the Globalization Group of the Intersecretariat Working Group of National Accounts (ISWGNA)7 has prepared the document G.9 Payments for Unproduced Knowledge-Based Capital (Marketing Assets)8, which analyses the registration of marketing assets in national accounts systems and balance of payments statistics. This document concludes by recommending the registration of marketing assets as non-financial produced assets and analysing the practical viability of said accounting principle.

24. It is true, however, that the lack of a clear, consensual, and shared guide for the valuation of the marketing assets produced can cause different countries to use different criteria for valuation, which would blur the comparisons between economies. It could even happen that the same country modified its valuation method, which would make it difficult to analyse the evolution of this type of assets. To avoid this risk, it has been decided, until now, not to value the production of marketing assets. In this way, although the investment figures in intangibles are biased, the bias that occurs is systematic and is not subject to subjective valuation criteria.

25. Therefore, the development of a consensual, robust, and practical methodology is one of the necessary conditions to begin to consider marketing assets as produced assets. This is what this paper begin to address for the Spanish economy.

III. Sources and methods

26. There are different types of economic operations associated with the production and use of marketing assets. To reflect all these flows in the system of accounts, it is necessary

7 The ISWGNA is a working group on National Accounts created by the United Nations Statistical

Commission (UNSC) in which the European Commission, the International Monetary Fund, the OECD, the United Nations and the World Bank participate. https://unstats.un.org/unsd/nationalaccount/iswgna.asp

8 https://unstats.un.org/unsd/nationalaccount/aeg/2022/M18/M18_10_G9.pdf

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to define the corresponding criteria for classifying these assets and valuing these operations. In particular, if we effectively consider these types of products as produced assets:

1) The creation of a marketing asset, that is, expenses incurred by a company to create a marketing asset on its own will be recorded as own-account production, P.12, of the company. From the use perspective, it will be recorded also within the company’s gross fixed capital formation (P.51).

2) The purchase and sale of marketing assets, that is, the transfer of all rights and obligations of the asset from one unit to another in exchange for a price will be recorded as gross fixed capital formation (P.51) too (acquisitions/disposals of fixed assets).

27. This paper focuses on testing a method for providing estimates on the total output (and investment) of marketing assets, considering both the own-account production and the acquisition of marketing assets in the market. The work of Carol A. Corrado, Charles R. Hulten and Daniel E. Sichel (CHS 2005) has become a central reference and a conceptual framework for measuring intangibles, in general, that has been assumed by most subsequent studies.

28. This reference proposes the most widely used method for estimating investment in intangibles and, in particular, marketing assets. It is based on a valuation by sum of cost for the own account production/gross fixed capital formation (1) and the application of a capitalization factor (CF) to the total purchases of marketing products by market producers to obtain the value to be capitalized (2).

29. In this method, double-counting as investment of marketing production sold in the market should be avoided. To achieve this, not all the purchases of such products by producers primarily dedicated to production of this kind of products should be considered as investment (CF should be reduced in that branch of activity).

A. Own-account production

30. Generally, in specialized literature, all estimates of marketing expenditure by own account are obtained by summing costs, which is consistent with the method commonly used in national accounts to estimate other flows that are not exchanged in the market, like expenditure on own-account development of R&D or software. This is also the approach followed in this work.

31. From this perspective, the value of own-account production would be equal to the labour costs (compensation of employees) of personnel engaged in marketing production (CE), plus the current expenditure on inputs (intermediate consumption) used in such production (IC), plus the depreciation of the produced asset (consumption of fixed capital) (CFC) and plus other taxes less subsidies on production9.

32. Estimates on the first component (CE) are carried out by identifying, within each branch of activity, the number of workers involved in those activities, the wage cost of these occupations (in terms of compensation of employees, i.e., including wages, in cash and in kind, and employer social contributions) and the percentage of time they dedicate to these activities. At national level, two statistical sources, compiled by National Statistical Institute (INE) of Spain, are highly relevant for the development of such estimates:

• The Structure of Earnings Survey (Encuesta de Estructura Salarial, SES), which provides information on the wage cost of occupations at detailed level of the National Classification of Occupations (CNO 2011)10.

9 One could argue for the inclusion of a profit margin. However, we have omitted the profit margin to

maintain consistency with the methodologies referenced in the bibliography, as EUKLEMS & INTANProd. Anyway, should we opt for a 10% profit margin, we can allocate additional time to the production of marketing assets to 16.5% (=15%+1.5%) and to 55% (=50% + 5%) for directors and technicians respectively.

10 National adaptation of the International Standard Classification of Occupations (ISCO-08).

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• The Labour Force Survey (Encuesta de Población Activa, LFS), which provides information on the number of jobs per occupation and branch of activity, also at detailed level of the CNO 2011 and of the National Classification of Activities (CNAE 2009)11.

33. In a base scenario calculation, various three-digit CNO occupations are considered to account professionals involved in the production processes of marketing products/services:

• Sales, Marketing and Development Managers CNO 12212.

• Sales, Marketing and Public Relations Professionals (CNO 265 and CNO 264)13.

• Other occupations, which include: Visual artists (CNO 29314), Draughtspersons (CNO 31115), Telecommunications and broadcasting technicians (CNO 38316) and Printing trades workers (CNO 76217).

34. The percentage of their workday that these professionals dedicate to internal marketing development within the company are based on different business organization studies and consistent with the assumptions made in the methodological references18: in the base scenario, 15% in the case of CNO 122 ,50% in the case of CNO 265 and 264, and 5% in the case of the other occupations considered.

35. Thus, the procedure for estimating personnel expenditure would consist of:

• Multiplying the average wage costs in each branch of activity, as gathered by the SES survey, by the number of employees (categorized by their employment status: self- employed workers, employees, and a combination of both) in those occupation, as gathered by the LFS survey, and by the percentage of time dedicated to the aforementioned activities. The salary of self-employed workers has been equated with that of employed workers.

• Calibrating the result to the concept of compensation of employees in terms of national accounts by applying, in each branch of activity, a correction factor defined as the ratio between the compensation of employees for marketing and the total wage cost in each industry according to the available National Accounts data.

36. Additionally, the remaining cost components (intermediate consumption, depreciation and taxes) will be estimated assuming a proportional distribution of cost related to marketing activities similar to that of labour expenditure in each industry, based on the available national accounts figures for the reference year (2021).

B. Marketing purchases

37. The expenditure on marketing asset acquisitions can be identified in the available Supply and Use Tables of the National Accounts. Under SNA 2008, it corresponds to the intermediate consumption of advertising services and market research (CPA19 73) in each branch of activity. The method for estimating such expenses would remain the same as that already employed in the current series of the national accounts.

38. These purchases will be multiplied by the CF in each industry. In the base scenario, the CF is set at 0,6, except in the case of the advertising services and market research industry, where a reduced CF is considered (0,3). This adjustment prevents double counting

11 This is consistent with European Classification of Economic Activities (NACE Rev.2), that in turn

follow the recommendations adopted by the United Nations Statistical Commission embodied in the current International Standard Industrial Classification (ISIC Rev.4).

12 ISCO 122. 13 ISCO 243. 14 ISCO 2651. 15 ISCO 3118. 16 ISCO 352. 17 ISCO 732. 18 EUKLEMS & INTANProd.

19 Classification of Products by Activity.

ECE/CES/GE.20/2024/17

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as investment of purchased marketing products that are subsequently resold in the market. “Capitalization factors do not vary across industries, except for the industry producing the corresponding asset, where capitalization factors are reduced to reflect estimates of the industry own use, i.e., subcontracting activity within the industry” (Bontadini 2023).

IV. Experimental data

A. Base scenario

39. The table below displays calculations that underpin the base scenario of marketing asset production and investment in the Spanish economy for the reference year 2021:

B. Sensitivity analysis

40. Building upon this scenario, we have conducted a sensitivity analysis that encompasses a 'low scenario' and a 'high scenario,' incorporating more constrained and expansive hypotheses, respectively.

41. In the sensitivity analysis, the variables considered include the percentage of time attributed to 'Other occupations', the occupational status (limited to 'Employees' in the 'Low scenario' and expanded to 'Total', including both employees and self-employed people in the 'base' and in the 'high’ scenarios), and the capitalization factor (CF), with the following thresholds:

42. In the 'Low scenario’, 'Other occupations' are excluded, and only employed workers are taken into account. Moreover, the CF applied across all industries is 0,5, except for the advertising services and market research industry, where it remains at 0,3.

Production/gross fixed capital formation on marketing assets Year 2021 NACE sections

A BDE C F GHI J K L MN - ex MK MN - MK OPQ RSTU Total Occupations (ISCO)

122 Sales, marketing and development managers Average wage (euros) - 168.152 61.200 46.471 151.125 52.254 65.013 48.855 114.237 66.841 186.523 77.127 Nº of workers 100 1.150 27.300 2.375 27.075 10.075 6.050 800 6.671 13.004 2.250 4.300 101.150 % time share spent in marketing production by occupation 15% 15% 15% 15% 15% 15% 15% 15% 15% 15% 15% 15% Total= wage by worker by time (million euros) - 10 251 17 209 79 59 6 55 130 21 25 862

243 Sales, marketing and public relations professionals Average wage (euros) - 126.355 53.421 29.140 40.426 - - 29.391 54.587 22.139 57.925 - Nº of workers - 14.625 14.150 5.500 5.025 - - 2.250 984 2.216 550 - 45.300 % time share spent by occupation 50% 50% 50% 50% 50% 50% 50% 50% 50% 50% 50% 50% Total= wage by worker by time (million euros) - 372 378 80 102 - - 33 14 25 7 - 1.009

XXX Other occupations Average wage (euros) - 56.521 23.835 26.198 71.144 35.827 - 40.552 39.880 22.713 62.132 63.859 Nº of workers 300 750 49.550 4.750 37.675 17.275 150 1.675 8.923 17.352 20.725 30.275 189.400 % time share spent by occupation 5% 5% 5% 5% 5% 5% 5% 5% 5% 5% 5% 5% Total= wage by worker by time (million euros) - 1 59 6 40 31 - 3 9 20 23 46 238

Marketing assets wage cost (million euros) - 383 688 103 351 110 59 42 78 175 51 71 2.110

Compensation of employees (million euros) 7.365 11.191 73.865 38.857 130.999 28.225 19.854 5.196 68.314 3.580 180.394 31.523 599.363 Wages (million euros) 6.510 8.550 55.768 29.351 100.578 22.068 14.902 4.081 52.871 2.814 139.844 24.701 462.038 Ratio National CE/National wages 113% 131% 132% 132% 130% 128% 133% 127% 129% 127% 129% 128%

Compensation of employees (million euros) 0 507 911 136 455 141 79 54 101 222 65 92 2.762

Marketing purchases (million euros) 40 242 2.661 280 4.378 974 2.169 150 956 2.729 649 1.053 16.280 Capitalization factor 60% 60% 60% 60% 60% 60% 60% 60% 60% 30% 60% 60%

Capitalized marketing expenditure 24 145 1.597 168 2.627 585 1.301 90 573 819 389 632 8.949

National intermediate consumption (million euros) 31.695 65.071 427.383 98.505 228.387 52.578 35.664 22.918 72.469 7.854 85.693 29.643 1.157.860 Consumption of fixed capital 4.887 28.096 11.330 14.255 35.466 13.842 5.288 40.020 16.853 524 29.890 6.080 206.531 Other taxes less subsidies on production (million euros) -5.628 757 301 2.096 691 -3 3.016 9.427 -877 -11 315 -132 9.952 Other expenses, total (million euros) 30.954 93.924 439.014 114.856 264.544 66.417 43.968 72.365 88.445 8.367 115.898 35.591 1.374.343 Ratio: Marketing CE /National CE 0,000% 4,531% 1,233% 0,351% 0,347% 0,498% 0,396% 1,037% 0,147% 6,205% 0,036% 0,292%

Other capitalized marketing expenses (million euros) 0 2.409 5.413 403 764 331 174 750 126 519 42 168 11.100

Total produced marketing assets (million euros) 24 3.061 7.921 707 3.846 1.056 1.554 895 800 1.560 497 892 22.812

SCENARIO DEFINITION BASE HIGH LOW ISCO-122 % time 15% 15% 15% ISCO-243 % time 50% 50% 50% Other occupations % time 5% 15% 0% Other occupations CNO 293 - 311 - 383 - 762 CNO 293 - 311 - 383 - 762 CNO 293 - 311 - 383 - 762 Occupational status Total Total Employee Capitalization factor 60% 70% 50%

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43. In the 'High scenario,' the 'Other occupations' allocate 15% of the workday to internal marketing development. Additionally, both self-employed and employed workers are assessed, with a CF of 0,7 applied across all industries, except for the advertising services and market research industry, where it remains at 0,3.

44. The following graphs illustrate the relative impact of the results from this sensitivity analysis on Spain's primary macroeconomic indicators, compared to the significance of the intangible assets (intellectual property products) currently measured and already incorporated within the core framework of the national accounts under SNA 2008/ESA 2010.

Production/gross fixed capital formation on marketing assets Year 2021 NACE sections

A BDE C F GHI J K L MN - ex MK MN - MK OPQ RSTU Total Occupations (ISCO)

122 Sales, marketing and development managers Average wage (euros) - 168.152 61.200 46.471 151.125 52.254 65.013 48.855 114.237 66.841 186.523 77.127 Nº of workers 100 950 24.475 2.200 23.825 9.450 6.000 700 5.787 10.063 2.075 4.300 89.925 % time share spent in marketing production by occupation 15% 15% 15% 15% 15% 15% 15% 15% 15% 15% 15% 15% Total= wage by worker by time (million euros) - 9 225 15 184 74 59 5 47 101 19 25 763

243 Sales, marketing and public relations professionals Average wage (euros) - 126.355 53.414 29.069 40.426 - - 29.391 55.327 22.878 57.925 - Nº of workers - 14.125 13.650 4.975 4.500 - - 1.500 856 1.594 450 - 41.650 % time share spent by occupation 50% 50% 50% 50% 50% 50% 50% 50% 50% 50% 50% 50% Total= wage by worker by time (million euros) - 359 365 72 91 - - 22 12 18 5 - 944

XXX Other occupations Average wage (euros) - - - - - - - - - - - - Nº of workers 300 750 40.750 4.375 29.000 10.950 150 1.100 6.180 13.770 18.975 9.000 135.300 % time share spent by occupation 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% Total= wage by worker by time (million euros) - - - - - - - - - - - - -

Marketing assets wage cost (million euros) - 368 589 88 275 74 59 27 60 119 24 25 1.707

Compensation of employees (million euros) 7.365 11.191 73.865 38.857 130.999 28.225 19.854 5.196 68.314 3.580 180.394 31.523 599.363 Wages (million euros) 6.510 8.550 55.768 29.351 100.578 22.068 14.902 4.081 52.871 2.814 139.844 24.701 462.038 Ratio National CE/National wages 113% 131% 132% 132% 130% 128% 133% 127% 129% 127% 129% 128%

Compensation of employees (million euros) 0 487 780 116 358 95 78 35 77 152 32 32 2.242

Marketing purchases (million euros) 40 242 2.661 280 4.378 974 2.169 150 956 2.729 649 1.053 16.280 Capitalization factor 50% 50% 50% 50% 50% 50% 50% 50% 50% 30% 50% 50%

Capitalized marketing expenditure 20 121 1.331 140 2.189 487 1.084 75 478 819 325 527 7.594

National intermediate consumption (million euros) 31.695 65.071 427.383 98.505 228.387 52.578 35.664 22.918 72.469 7.854 85.693 29.643 1.157.860 Consumption of fixed capital 4.887 28.096 11.330 14.255 35.466 13.842 5.288 40.020 16.853 524 29.890 6.080 206.531 Other taxes less subsidies on production (million euros) -5.628 757 301 2.096 691 -3 3.016 9.427 -877 -11 315 -132 9.952 Other expenses, total (million euros) 30.954 93.924 439.014 114.856 264.544 66.417 43.968 72.365 88.445 8.367 115.898 35.591 1.374.343 Ratio: Marketing CE /National CE 0,000% 4,349% 1,057% 0,299% 0,273% 0,336% 0,393% 0,666% 0,113% 4,234% 0,017% 0,103%

Other capitalized marketing expenses (million euros) 0 2.306 4.639 343 567 223 173 482 95 354 19 56 9.256

Total produced marketing assets (million euros) 20 2.914 6.750 599 3.114 805 1.335 592 650 1.324 375 615 19.092

Production/gross fixed capital formation on marketing assets Year 2021 NACE sections

A BDE C F GHI J K L MN - ex MK MN - MK OPQ RSTU Total Occupations (ISCO)

122 Sales, marketing and development managers Average wage (euros) - 168.152 61.200 46.471 151.125 52.254 65.013 48.855 114.237 66.841 186.523 77.127 Nº of workers 100 1.150 27.300 2.375 27.075 10.075 6.050 800 6.671 13.004 2.250 4.300 101.150 % time share spent in marketing production by occupation 15% 15% 15% 15% 15% 15% 15% 15% 15% 15% 15% 15% Total= wage by worker by time (million euros) - 10 251 17 209 79 59 6 55 130 21 25 862

243 Sales, marketing and public relations professionals Average wage (euros) - 126.355 53.421 29.140 40.426 - - 29.391 54.587 22.139 57.925 - Nº of workers - 14.625 14.150 5.500 5.025 - - 2.250 984 2.216 550 - 45.300 % time share spent by occupation 50% 50% 50% 50% 50% 50% 50% 50% 50% 50% 50% 50% Total= wage by worker by time (million euros) - 372 378 80 102 - - 33 14 25 7 - 1.009

XXX Other occupations Average wage (euros) - 56.521 23.835 26.198 71.144 35.827 - 40.552 39.880 22.713 62.132 63.859 Nº of workers 300 750 49.550 4.750 37.675 17.275 150 1.675 8.923 17.352 20.725 30.275 189.400 % time share spent by occupation 15% 15% 15% 15% 15% 15% 15% 15% 15% 15% 15% 15% Total= wage by worker by time (million euros) - 3 177 19 121 93 - 10 26 59 70 138 715

Marketing assets wage cost (million euros) - 385 806 115 431 172 59 49 95 214 97 163 2.586

Compensation of employees (million euros) 7.365 11.191 73.865 38.857 130.999 28.225 19.854 5.196 68.314 3.580 180.394 31.523 599.363 Wages (million euros) 6.510 8.550 55.768 29.351 100.578 22.068 14.902 4.081 52.871 2.814 139.844 24.701 462.038 Ratio National CE/National wages 113% 131% 132% 132% 130% 128% 133% 127% 129% 127% 129% 128%

Compensation of employees (million euros) 0 509 1.067 153 555 220 79 63 123 272 125 211 3.377

Marketing purchases (million euros) 40 242 2.661 280 4.378 974 2.169 150 956 2.729 649 1.053 16.280 Capitalization factor 70% 70% 70% 70% 70% 70% 70% 70% 70% 30% 70% 70%

Capitalized marketing expenditure 28 169 1.863 196 3.065 682 1.518 105 669 819 454 737 10.305

National intermediate consumption (million euros) 31.695 65.071 427.383 98.505 228.387 52.578 35.664 22.918 72.469 7.854 85.693 29.643 1.157.860 Consumption of fixed capital 4.887 28.096 11.330 14.255 35.466 13.842 5.288 40.020 16.853 524 29.890 6.080 206.531 Other taxes less subsidies on production (million euros) -5.628 757 301 2.096 691 -3 3.016 9.427 -877 -11 315 -132 9.952 Other expenses, total (million euros) 30.954 93.924 439.014 114.856 264.544 66.417 43.968 72.365 88.445 8.367 115.898 35.591 1.374.343 Ratio: Marketing CE /National CE 0,000% 4,552% 1,445% 0,393% 0,424% 0,779% 0,396% 1,204% 0,180% 7,606% 0,069% 0,670%

Other capitalized marketing expenses (million euros) 0 2.438 6.343 451 1.023 517 174 871 155 636 83 392 13.083

Total produced marketing assets (million euros) 28 3.116 9.273 800 4.642 1.419 1.771 1.039 947 1.727 662 1.340 26.764

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IV. Conclusions and next steps

45. The need to keep the System of National Accounts relevant for its broad range of users is clearly shared by all the statistical community. Better reflecting in the ‘core’ national accounts the important elements related to globalisation, digitalisation and environmental sustainability that are recommended to be included in the updated version of the System of National Accounts goes in that direction.

46. In particular, the measurement of intangibles within the economy holds critical importance as it reflects the value of intellectual property, innovation, and brand equity that traditional metrics may overlook. As the global economy evolves, the role of intangible assets becomes increasingly pivotal in driving growth, competitiveness, and productivity. Recognizing and accurately valuing these assets can provide a more comprehensive understanding of a country's economic health and potential for future development. This underscores the need for evolving economic models and accounting frameworks that can capture the full spectrum of value creation in the modern economy. Thus, this is an emerging challenge for official statistics and the systems of national accounts that should not be disregarded.

3,6%

1,9% 2,2%

1,6%

Current IPPs MK Base MK High MK Low

Share of GDP

18,0%

9,3% 10,9%

7,8%

Current IPPs MK Base MK High MK Low

Share of GFCF

ECE/CES/GE.20/2024/17

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47. However, the practical challenges involved in quantifying the value of intangible assets often pose a risk to international and temporal comparability. Estimates rely on various assumptions regarding associated flows and stocks, mirroring challenges faced with other intangible assets such as R&D and software. The sensitivity analysis conducted in this experimental study on marketing assets underscores this uncertainty. To address this, precise, standardized, and timely guidance is crucial for refining these estimates, both at the European and global levels, to ensure the comparability of national accounts data over time.

48. Meanwhile, INE-Spain will further explore sources and methodologies for measuring marketing assets through the following steps:

• Exploring a more accurate definition of marketing products within the scope of the advertising services and market research (CPA 73).

• Evaluating potential instances of double counting within marketing and R&D activities.

• Assessing the implications of incorporating a profit margin into the 'sum of cost' valuation of own-account marketing, along with other potential components of this valuation, in light of the suggested new SNA principles regarding the sum of costs.

• Replicating these calculations for additional reference years to analyze the robustness of resulting investment series in terms of volatility induced by primary sources.

• Estimating deflators and subsequent series in volume terms.

• Calculating balance positions and deriving consumption of fixed capital estimates, based on the Permanent Inventory Method generally adopted in the national accounts framework. This process will involve establishing new hypotheses regarding depreciation parameters particularly referred to marketing assets.

• Developing compilation strategies for integrating marketing estimates within non- market or financial activities accounts.

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Bibliography and references

Akerblom (1998), Measure Intangible Investment, Mikael Åkerblom, Benjamin Camus, Jean-Paul François, Vosselman, Geir Frengen, Frank Foyn, Gunila Nockhammar, OECD, 1998

Bontadini (2023), EUKLEMS & INTANProd: industry productivity accounts with intangible, Bontadini. F, C. Corrado., J.Haskel., M.Iommi., C.Jona-Lasinio, Luiss Lab Of European Economics, 2023

Cañibano (2000), Account for Intangibles: A Literature Review, Leandro Cañibano, Manuel García-Ayuso, Paloma Sánchez, Journal of Accounting Literature vol 19, 2000, pp 102-130, 2000

Corrado (2005), Measuring Capital and Technology. An Expanded Framework, Carol Corrado, John Haltiwanger and Dan Sichel, National Bureau of Economic Research, 2005

Hall (2007), MEASURING THE RETURNS TO R&D: THE DEPRECIATION PROBLEM, Bronwyn H. Hall, NBER Working Paper 13473, 2007

Heys (2021), Delivering Tangible Estimates of non-SNA Intangible Assets, Richard Heys, Eurydice Fotopoulou, Office for National Statistics, 2021

Jorgenson (2016), WORLD KLEMS: Productivity and Economic Growth in the World Economy, Dale W. Jorgenson, International Productivity Monitor, 2016

Martin (2019), MEASURING THE OTHER HALF: NEW MEASURES OF INTANGIBLE INVESTMENT FROM THE ONS, Josh Martin, Office for National Statistics, 2019

Mas (2019), La Economía Intangible en España , Matilde Mas, Javier Quesada, Marta Solaz , Laura Hernández, Eva Benages, Aleix Pons, Javier Pallás, Cotec Ivie, 2019

Roth (2019), Intangible Capital and Labour Productivity Growth: A Review of the Literature, Felix Roth, Hamburg Discussion Papers in International Economics, No. 4, 2019

Thum-Thysen (2021), Complementarities in capital formation and production Tangible and intangible assets across Europe, Anna Thum-Thysen, Peter Voigt , Christoph Weiss , EIB Working Paper 2021/12, 2021

Instituto Nacional de Estadística

Measuring intangible assets in the Spanish economy.

Marketing assets

UNECE NAEG, 24th April 2024

Index

1. Context

2. Sources and methods

3. Experimental data

4. Conclusions and next steps

Index

1. Context

2. Sources and methods

3. Experimental data

4. Conclusions and next steps

Marketing assets in NA (now)

 Non-produced non-financial assets

Natural resources

Contracts, leases and licenses

Goodwill and marketing assets

Web domains

Brand names

Slogans

Logos

Marketing assets as fixed produced assets

Brand names Logos

Web domains Slogans

Store of value, benefits for its owner, result of production process

Used repeteadly in the production process

Web domains

Brand names

Slogans

Logos

Marketing assets as fixed produced assets

The major reason for not treating marketing assets as fixed assets is due to the difficulty of measuring their value (SNA 2008, A4.53)

Web domains

Brand names

Slogans

Logos

SNA 2025

¿Marketing assets in SNA 2025/BPM7?

 Produced non-financial assets (IPPs)

R&D

Software

Mining exploration and evaluation

Originals for recreation, literary and artistic

Data

Marketing assets

Eurostat grant: SNA implementation tests

Literature/experi encies review

Sources identification

Design of methods

Experimental estimates

Conclusions

Ending-date June 2025

Index

1. Context

2. Sources and methods

3. Experimental data

4. Conclusions and next steps

Production/investment in marketing

Own-account production/invest ment (P.12/P.51)

Acquisitions of marketing assets

(P.51)

Methodologycal references

Marketing P/I = (1) + CF*(2)

Own-account marketing

Sum of costs = CE+ IC + CFC + T/S

 Compensation of employees (CE): pivotal variable

 Other costs: CE proportional distribution

Own-account marketing

CE = Workers x Average CE x Time

 Occupations (LFS):

 Sales, marketing and development managers (ISCO 122)

 Sales, Marketing and PR Professionals (ISCO 243)

 Others (ISCO 2651, 3118, 352, 732)

Own-account marketing

CE = Workers x Average CE x Time

 Average wage (Structure Earnings Survey)

 Calibration CE/Wages (NA data)

Own-account marketing

CE = Workers x Average CE x Time

 Time in marketing (hypothesis):

 Sales, marketing and development managers (ISCO 122)

 Sales, Marketing and PR Professionals (ISCO 243)

 Others (ISCO 2651, 3118, 352, 732)

Purchases of marketing

Capitalization factor (CF)

Index

1. Context

2. Sources and methods

3. Experimental data

4. Conclusions and next steps

Experimental results. Spain

Sensitivity analysis SCENARIO DEFINITION BASE HIGH LOW ISCO-122 % time 15% 15% 15% ISCO-243 % time 50% 50% 50% Other occupations % time 5% 15% 0% Other occupations CNO 293 - 311 - 383 - 762 CNO 293 - 311 - 383 - 762 CNO 293 - 311 - 383 - 762 Occupational status Total Total Employee Capitalization factor 60% 70% 50%

0

5000

10000

15000

20000

25000

30000

Base Low High

Marketing assets

Purchases

Own-account

Sensitivity analysis

Sensitivity analysis

Index

1. Context

2. Sources and methods

3. Experimental data

4. Conclusions and next steps

Conclusions

Need to keep the SNA relevant

 Intangibles are critical for productivity and growth

Theoretical consensus: marketing as an asset .

Uncertainty requires practical guidelines

Next steps

 Accurate definition of marketing products

 Double counting with R&D

 Refining own-account value

 Calculation of series

 Deflators

 Stocks and CFC

 Compilation strategies

Thank you

Sixto Muriel de la Riva

Division Director Large Cases Unit

INE-Spain

[email protected]

List of tables

Table1

Table2

Table 2a

Table 2b

Table 3

Table 4

Table 5

Table 5a

Table 6

Table 6a

Table 6b