Estimating government stock of fixed capital

This report is a product of the seventh meeting of the 2011 ICP Technical Advisory Group (TAG) that was held from September 17 to 18, 2012 at the World Bank in Washington, DC. If productivity adjustments are made for government in ICP 2011, they will probably require an estimate of the government capital stock. For ICP 2005 the relative sizes of government capital stocks in different countries was (initially) assumed to be proportional to each country’s total constant price GFCF cumulated over the last 10 years.1 Clearly that is a crude estimate of the relative size of the fixed capital assets held by governments in the different countries. The short-cut method outlined below should give a better estimate of government capital stocks. It could be used by the countries themselves or by the global or regional offices. It only requires information on government GFCF for a single years and plausible assumptions about depreciation rates and past growth rates of government GFCF.