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REGIONAL LINKING

This document explores the principles of ring linking in regional economies, highlighting the inherent disadvantages of relying on single links. The main framework includes creating a ring product list despite limited overlap in regional lists, maintaining regional fixity at the Basic Heading (BH) level, and producing BH parities with the Consumer Price Reference Database (CPRD). It discusses two versions of running a global BH matrix for OECD countries to enhance comparability and economic assessments. An in-depth analysis serves as a guide for addressing regional economic disparities.

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REGIONAL LINKING

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  1. REGIONAL LINKING ICP 2005 ROUND

  2. Past Practice: Bridge Countries Disadvantage: Reliance on single links

  3. Ring Region

  4. Principles of Ring Linking • 1. Ring product list is created (because Regional lists have limited overlap); • 2. Regional fixity is retained at BH level; • 3. Regional BH parities are produced with CPRD; • 4. Ring Region is used for linking only [with a CPRD-style index].

  5. Ring linking: an example

  6. FIXITY • Item level • BH level • GDP level • All aggregates

  7. Fixity at the GDP level (OECD) • Version 1. Running full global BH matrix, with each OECD country as a separate entity, then the OECD total is redistributed on the basis of the regional OECD comparison. • Version 2. Creating an OECD “country” to be included in the global comparison, then the OECD “country’s” GDP is redistributed on the basis of the regional OECD comparison.

  8. Questions?

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