Page 240 - Contributed Paper Session (CPS) - Volume 6

CPS1908 Klára A. T. et al.

Employment of domestic concept in the
framework of process table

Klára Anwar , Ildikó Ritzlné Kazimir
National Accounts Department, Hungarian Central Statistical Office, Budapest, Hungary

Abstract
The European Commission emphasised that labour input (Commission
Decision, 94/168) could be one of the useful mechanism for assessing the
exhaustiveness of gross domestic product (GDP) estimates. (OECD (2002))
From that time employment estimation in domestic concept (i.e. in line
with the National Accounts) was developed in Hungary. The purpose of
the development is to ensure the harmonization of production account
and employment data. In this study we develop the methodology of non-
observed employment estimation by categories of non-observed
economy (NOE), prepared by Eurostat, (Eurostat (2005a)) and prepare the
process table (PT) for the employment in domestic concept. This new
approach, includes – similarly to the production of gross value added –
data in institutional sector, Statistical Classification of Economic Activities
in the European Community (NACE) and process table categories
breakdown. Therefore it will provide a complete picture of the
employment structure of the Hungarian economy. Furthermore it can
facilitate the validation of gross value added from production side, and it
allows detailed analysis.

Keywords
Non-observed economy; National Accounts; employment method

1. Introduction
The non-observed economy in Hungary spread considerably after the
regime change, at the beginning of nineties. The transformation from
socialism to market economy caused uncertain legal, institutional and
economic environment, therefore the tax fraud and the illegal activities
became more and more significant in the economic performance. The ratio
of the non-observed activities reached 30% of GDP in 1992. (Árvay &Vértes
(1994)) After the transformation period, the ratio of non-observed
economy had decreased, and its share became 14.9% of GDP in 2005.
(Murai &Ritzlné (2011)) However Medina and Schneider estimated 22.5%
share of shadow economy from Hungarian GDP for the year 2005. (Medina
&Schneider (2017))

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