Page 241 - Contributed Paper Session (CPS) - Volume 6

CPS1908 Klára A. T. et al.
The non-observed economic activities have to be estimated and
included into the national accounts according to the European System of
National Accounts 2010 (ESA 2010). Their estimation raises several
problems. These activities include illegal or tax fraudulent activities, as well,
while such activities of households result problems in the data collection
process. Due to lack of appropriate available information, econometric
models, statistical estimation processes are widely used in these
estimations. However, precise delimitation of activities is also essential. For
example the differences between the two above mentioned results for the
year 2005 are due to the fact that not the same nonobserved economic
categories were covered. In the official statistics the Tabular Approach to
Exhaustiveness determines the activities included in the non-observed
economy. (Eurostat (2005a)) Cross-validation of the results is very crucial
in the estimation process of non-observed economy, because of their
sensitivity and the economic actors’ interest to hide the information.
Obvious method for cross validation is the comparison of output and input
side of non-observed economy. The labour input can validate the gross
value added and give information about the productivity as well.
The basis of the labour input calculations is the labour force survey
(LFS). In order to validate the gross value added data, first the LFS data
have to be adjusted, because it represents the national concept. To be able
to make comparison of different concepts possible, the labour input data
have to be compiled in such a detailed breakdown as the gross value
added.
This paper describes a framework that allows the comparison and
validation of gross value added and employment data. To this purpose we
apply the process table approach. In the first step, we identify the PT
categories, i.e. adding labour input into production. In the second step the
potential data sources are determined. Finally, we provide estimation of
the non-observed employment for the average of years 2014-2016.

2. Methodology
In order to reach employment data in domestic concept, from that of
national concept, like LFS several bridges should be taken into account
according to ESA 2010 (Eurostat (2013)). This is illustrated in the right side
of Table 1. Employed persons living abroad but working in Hungary, in a
resident company should be part of the employment data of the country
whereas employed persons living in Hungary but working abroad, i.e. for
a non-resident company are not part of it, instead they are part of the
employment of the country where the company they are working for is
resident. The same is the case with the employees of the embassies. If
Hungarian embassies, wherever they are, employ a foreign resident, it

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