Compiling the Long-term Statistics Database for Taiwan

Toshiyuki Mizoguchi


The first issue of the Newsletter lays out the basic plan for the Asian Historical Statistics Project. While there are numerous details which we will never be able to verify, we will calculate national income statistics (especially by using flow accounting), and use the results to create and refine a long-term economic statistics database. The work on Taiwan is more advanced than for other countries or regions, yet even in this case there is certain information which we are still attempting to locate. Therefore, the reader is warned that the research plan outlined below may well be revised in the future or replaced by new plans.

The basic intent of the Statistics Project is to search for information from the earliest period possible through 1990. We will divide Taiwan's economic history into the following periods:

(1) Before 1885 (Under Ching Dynasty rule): Very little statistical material is available.

(2) 1886-1912 (First period of Japanese occupation): Some statistics are compiled but not in systematic fashion.

(3) 1912-1938 (Middle period of Japanese occupation): Advances in gathering of statistics makes systematization possible.

(4) 1939-1950 (Second World War and Chinese Civil War): Some data is kept secret because of wartime policies, and other data is lost because of economic turbulence.

(5) 1951-1960 (The Taiwanese government begins to collect data): Essential data becomes available.

(6) 1961-1990 (The Taiwan government systematizes data collection): The gathering of data, including censuses and compilation of industrial input-output tables, reaches the standard of an advanced nation.

The official statistics compiled since 1961 are highly respected in Asia for their reliability, and the Statistics Project therefore needs only to adjust the figures to meet its particular guidelines (apart from efforts to upgrade stock statistics, which have created some difficulties). It is necessary to compile some additional estimates for Period 5 (1951-1960), but the official statistics are generally sufficient. The two major sources for the latter two periods are Directorate-General of Budgets, Accounting & Statistics (DGBAS), Executive Yuan, National Accounts in Taiwan for 1951-1990 and Preliminary Estimate of National Income in Taiwan for 1992 (1992); and DGBAS, Statistical Yearbook of the Republic of China (Annual Publication). The former provides flow accounting based upon the "new SNA structure." It also provides nominal expenditure accounts for 1951-91, as well as real price accounts in 1986 prices for the same period. Nominal production accounts are also provided for 1951-91, but real value accounts are provided only from 1961.

The main source for periods 3 and 4 (1912-38 and 1939-50), is Taiwan sotokufu tokei sho [Statistical Annual of the Government General of Taiwan] (in Japanese), available for all years from 1899 to 1942. In 1912, Taiwan sotokufu tokei sho shifted from using vertical writing to horizontal writing, at which time the content of the statistics was improved and expanded. This means that a detailed national income statistics database can be compiled only for the period from 1912, although data is available for certain areas such as agriculture and foreign trade for as far back as the 1890s. Taiwanese and Japanese researchers have already made extensive use of this statistical material to produce some important findings. Two important works on Systems of National Accounts (SNA), both including national income statistics, are "T.H. Lee estimates" and "Hsing estimates," both written in the 1960s and cited in Samuel Ho, Economic Development of Taiwan, 1860-1970 (Yale University Press, 1978). However, it is not quite clear what methods were used to compile the estimates. (Ho's volume provides an appendix of the works which arranges and overviews Taiwan's historical statistics.)

Another statistical research project was conducted in cooperation with Japanese researchers, primarily from Hitotsubashi University, in the late 1960s. The results appeared in the following two works: Miyohei Shinohara and Shigeru Ishikawa, eds., Taiwan no keizai seicho [Taiwan's economic growth] (Institute of Developing Economies, 1971) and Toshiyuki Mizoguchi, Taiwan E Chosen no keizai seicho [Economic growth in Taiwan and Korea] (Iwanami Shoten, 1975). These were in turn compiled in a major collection edited by Umemura Mataji and Toshiyuki Mizoguchi, eds., Kyu-Nihon shokuminchi keizai tokei, suikei to bunseki [Economic statistics of former Japanese colonies, estimates and analysis] (Toyo Keizai Shimposha, 1988).

The above three works cover only the period of Japanese occupation, but Toshiyuki Mizoguchi attempts to compile long-term statistics beginning from around the time of liberation from Japanese control and link them to the earlier time series in his article "Taiwan E Kankoku no kokumin keizai keisan choki keiretsu no suikei" [Long-term national economic calculations of Taiwan and Korea] which appeared in Mizoguchi, editor, Nihon E Taiwan E Kankoku no choki hatten (senzen E sengo o fukumu) no bunseki [Analysis of the long-term (including prewar and postwar) development of Japan, Taiwan, and Korea] (Institute of Economic Research, Hitotsubashi University; Mizoguchi Research Office, 1988). The work uses price data to compare the pre-liberation expenditure data to the post-liberation data in real as well as in nominal terms. This meant that two benchmark years were used to create a deflator, so that the two periods were linked through the "indirect method" of a real base. What really stimulated this type of research was the long-term statistical time series analysis completed at the Department of Economics at Taiwan University in the early 1990s. Among the multi-faceted research, national economic statistics were led off by Tsong-Min Wu, "An Estimation of Taiwan's Gross Domestic Product: 1910-1950," Taiwan Economic Review 19, No. 2, June 1991 (in Chinese). This work assembles statistical estimates on production accounts for 1910-1951 using both nominal and real bases. The figures on expenditures for nominal gross domestic production, when compared to those compiled by Mizoguchi and Noriyuki Nojima (cited in Umemura and Mizoguchi, 1988), are rather high but the difference is within the 15% range. On the other hand, when a real base is employed, Wu's estimated figures are rather lower, though the difference is certainly not decisive. This research has two distinctive features:

(1) The "direct method" was adopted to link the time series estimates for the period of economic chaos, including hyper-inflation, which occurred in 1945-51, at and just after the liberation.

(2) Their production side estimates of gross domestic product for 1947-1951 were much more reliable than past estimates and could be compared with Mizoguchi and Noguchi's expenditure accounts.

In addition, the task of compiling estimates was greatly advanced by the completion of DGBAS, Executive Yuan, of a collection of unpublished materials (in Chinese) in 1995. This research used the new SNA method to calculate production accounts for 1946-1951, and the results might be regarded as "quasi-official materials." Although the unpublished materials are being used, they are expected to be revised in the future, so we will not cite them here. However, these sources give figures for gross national product for 1946 which are lower than those calculated by Wu. By investigating the reasons for the discrepancies and revising Wu's figures, we may be able to reduce the discrepancy between Wu's figures and those of Mizoguchi and Nojima.

Table 1 Tentative Estimates of Taiwan's National Economic

    1915

(thousand yuan)

1925

(thousand yuan)

1935

(thousand yuan)

1951

(million yuan)

1951

(million yuan)

1951

(million yuan)

1951

(million yuan)

1951

(million yuan)

Expenditure accounts Private consumption expenditures 4.396 12.354 15.151 8,928 42,559 127,636 767,742 2,302,09
  Government consumption expenditures 0.320 0.983 1.421 2,200 12,032 41,397 237,160 743,773
  Domestic gross capital formation 0.430 2.265 4.355 1,779 12,618 57,886 503,911 945,839
  Export 2.168 7.053 10.374 1,257 7,192 68,784 783,272 2,013,953
  Import 1.790 5.170 7.918 1,836 11,894 68,860 801,026 1,783,570
  [Total gross domestic production] 5.329 17.137 23.383 12,328 62,507 226,805 1,491,059 4,222,004
Production accounts Primary industries 2.156 7.702 8.332 3,980 17,838 35,076 114,556 174,242
  Secondary industries 1.202 4.019 6.012 2,630 16,796 83,530 682,114 1,795,742
  Tertiary industries 2.228 5.965 7.439 5,718 27,873 108,199 694,389 2,252,020
  Statistical discrepancy -0.317 -0.549 1.600 0 0 0 0 0

NotesF

  1. Post-liberation inventory increases added to gross domestic stock formation.
  2. Adjustments to imputed interest and customs duties included in tertiary industries.
  3. Industrial classfications: primar industries include agriculture, forestry; secondary industries include manufacturing, mining, energy and water supplies, and construction; and tertiary industries, the public sector, and non-profit organzations.

We have been strongly encouraged by the progress made so far. The next task of the Statistics Project with regard to Taiwan will be to use the official and the quasi-official time series of the DGBAS, the expenditures table of Mizoguchi and Nojima, and the production accounts tables of Wu to compile a long-term time series which will incorporate both expenditures accounts and production accounts. The guidelines are as follows:

(1) Use the DGBAS's official statistics for 1951-1990 production and expenditures accounts. Calculate the deflator for 1951-1960 production accounts separately. Then change the reference year for the deflator to 1960 to make it compatible with the other Statistics Project databases.

(2) Wait for the DGBAS's 1941-1950 quasi-official production accounts materials to become available for public use (in the meantime, preliminary testing will continue). We will make estimates of only one portion of the expenditures accounts, and estimates for consolidated accounts will not be conducted during this period.

(3) The figures of Mizoguchi and Nojima, slightly adjusted, will be used for the 1912-1938 expenditures accounts. Supplementary outside materials will be used for the 1939-41 period.

(4) Information available through the DGBAS will be used to directly link nominal and real figures for government consumption, imports, and exports to the post-liberation SNA time series. It is difficult to obtain statistics on private consumption and gross domestic capital formation for 1942-50, but it is possible to directly link nominal figures to post-liberation data. To link real figures, we will rely not on indirect methods as we have up to now, but shift to the direct method of using the Taiwanese government's official statistics on price indicators, which also cover the period of economic chaos (1945-51).

(5) We will use the 1941 values in the DGBAS's quasi-official estimates as a starting point, and also use Wu's figures to compile production estimates for 1912-1940.

At present, we have completed the initial testing phase for all of the above five steps other than No. 3, which is an extension of the work. The results enable us to control to within 10% of gross domestic production for the "statistical discrepancy" between nominal production accounts and expenditures accounts for 1912-38, making it possible to achieve sufficient compatibility between the two. (For 1951-90, the DGBAS's official statistics put the value at zero in conducting its estimates.) There is some discrepancy, though it is not crucial, between the figures for real gross national production obtained from real expenditures accounts estimated on a direct price comparison basis, and production accounts figures obtained from directly linked quantitative indicators and other factors. Further adjustment is possible in this regard.

Let us explain the tests we have been conducting. Table 1 shows a portion of the tests which is unrelated to the unofficial materials of the Taiwan Statistics Office (because 1951 data is shown in place of the 1950 data generally used so far). Nominal data used in the same chart is calculated on the basis of New Taiwan Dollars, so 1 New Taiwan Dollar = 40,000 Old Taiwan Dollars (note that the pre-1940 and post-1940 units are different). The information in Chart 1 can serve as the basis for any number of analyses, but if we look at Chart 2 and consider the relationship between:

Table 2@Tentative Estimates of Taiwan's Nominal National Economic Accounting(Yearly %)

  Nominal gross production Deflator Real gross production Population Per capita real gross production
1915-25 12.386 7.051 4.989 1.509 3.429
1925-35 2.812 -1.751 4.642 2.514 2.076
1935-38 8.962 5.520 3.267 2.633 0.615
1935-51 151.812 151.957 -0.065 2.810 -3.365
1951-60 19.767 10.748 8.153 3.347 4.634
1960-70 13.755 3.415 9.999 2.565 7.247
1970-80 20.721 10.682 9.072 1.951 6.984
1980-90 10.969 3.828 6.877 1.346 5.457

nominal GDP = deflator* real GDP
real GDP = population * real per capita GDP

we can then analyze the growth rate of nominal gross domestic product by breaking it down intoreal GDP, GDP deflator, and population growth, and find average growth rates for different periods. Taiwan's pre-World War II growth rate was high by international standards but because population growth was also high, there was little improvement in living standards. In contrast, rapid economic growth from 1960 brought a large increase in per capita GDP. In addition, we can infer that the economic chaos of the 1940s slowed real GDP growth and increased the GDP deflator by an even greater rate.

One of the central objectives of the Asian Historical Statistics Project is to compile related data, especially SNA estimates, into databases. The tentative plan for the makeup of our final report is that it will include the following ten sections:

1. System of National Accounts
2. Activities Indicators of Primary Industries
3. Activities Indicators of Secondary Industries
4. Activities Indicators of Tertiary Industries
5. Activities Indicators of Private Consumption
6. Activities Indicators of Government Finance
7. Statistical Data on Capital Formation
8. Foreign Trade Indicators
9. Finance and Price Statistics
10. Population and Labor Statistics

Each category will include basic data necessary to compile SNA estimates. Our objective is to complete this work by the end of 1996.

ToshiyukiMizoguchi
Hiroshima University of Economics, Department of Economics