holds are obtained.'? The Residential Energy
Consumption Survey collects data on various
types of energy sources, including the major
sources of home-heating energy: electricity, natu-
ral gas, and fuel oil. To compare this survey with
the CE Survey, BLS matches time periods and
types of fuel to the extent possible. An adjust-
ment is made to the CE data to exclude expendi-
tures for vacation properties because such hous-
ing units are not included in the Residential En-
ergy Consumption Survey. Estimates from the
latter are for households that pay all their utili-
ties, a population that more closely matches the
population covered in CE estimates for energy ex-
penditures.'*

Table 3 shows estimates of aggregate expend-
itures from the CE Survey and ratios of CE Sur-
vey to Residential Energy Consumption Survey
estimates for 1984, 1987, and 1990 (the most
recent years for which the latter data are avail-
able). Some differences between the two surveys
are to be expected because the Residential En-
ergy Consumption Survey covers persons in the
military who live on post, a population not in-
cluded in the CE Survey. CE Survey estimates for
the combined major energy sources (natural gas,
electricity, and fuel oil) are close to those in the
Residential Energy Consumption Survey. Also,
although CE Survey estimates for the individual
energy sources differ from those of the Residen-
tial Energy Consumption Survey and are sometimes
higher, most of the estimates are relatively close.

National Health Accounts. The Health Care
Financing Administration of the Department of
Health and Human Services publishes estimates
of total aggregate health costs of the United States
in the National Health Accounts. Total health care
costs include payments for health care goods and
services that are made by all sources, public and
private. To derive the estimates for the National
Health Accounts, which are constructed to be
consistent in concept with the gross domestic
product, the Health Care Financing Administra-
tion uses a variety of administrative and estab-
lishment data sources. These sources include the
Census Bureau's Census of Service Industries
and Services Annual Survey, the American Hos-
pital Association’s Annual Survey of Hospitals,
and the monthly National Hospital Panel Sur-
vey. The National Health Accounts measures
health expenditures for the U.S. population cov-
ered by Social Security, which includes inhabit-
ants of U.S. territories, military personnel, and
U.S. citizens living outside the United States.!5
Estimates of out-of-pocket health care expend-
itures in the CE Survey are compared with esti-
mates of out-of-pocket health care expenditures
in the National Health Accounts over the 1988—

92 period.!© These estimates include expendi-
tures for over-the-counter drugs, prescription
drugs, medical equipment, professional medical
care services, and hospital care not covered by
third-party payers. These expenditures include
copayment and deductible amounts required by
third-party payers and out-of-pocket expendi-
tures for medical care by the uninsured. (Third-
party payers include governments, commercial
insurance companies, and other nonhousehold
sources, such as philanthropic organizations.)

Estimates of expenditures for nursing homes
are excluded from the comparisons because the
nursing home population is not covered in the
CE Survey. Also excluded are estimates for health
insurance premiums, medical equipment rentals,
and medical equipment repairs, none of which
are covered in the out-of-pocket estimates from
the National Health Accounts.

Table 4 shows that in 1992, out-of-pocket es-
timates of medical care expenditures from the
CE Survey amounted to $90 billion, 70 percent
of the National Health Accounts. This difference
reflects the CE Survey’s much lower estimates
for drugs and supplies, which account for 33
percent of the out-of-pocket total, and lower es-
timates for professional services, which account
for 48 percent of the same total. CE Survey data
show that $34 billion was spent out of pocket
for medical commodities and $52 billion was
spent out of pocket for medical services. As be-
fore, these estimates are about 70 percent of those
from the National Health Accounts.

The CE-to-National Health Accounts ratios

Table 3. Comparison of aggregate expenditures for household
fuels, Consumer Expenditure (ce) Survey and Residential
Energy Consumption Survey, 1984-90

Ratio of ce Survey to
ce Survey’

Residential E
Expenditure category (in billions) Consumption Survey?
1984° | 1967 | 1990 | 1984° | 1987 | 1990
Major household fuel, total...) $91.9 | so1.9 |s103.01] 1.00 | .96 | 1.05
Naturalgas...............| 265] 218| 238] 1.06 | 1.00 | 102
Electricity... a0 | 647} 730) 112 | ‘94 | 1106
Fuel oil .. 74] s4| 62| 100 | (93 | 95

1For purposes of comparison, ce Survey estimates are adjusted to exclude expenditures.
for owned or rented vacation property.

? Residential Energy Consumption Survey estimates are tor households that pay all their
utilities. Households for which utility costs are included in their rent are excluded.

3 Residential Energy Consumption Survey estimates are for the 12-month period from
April 1984 to March 1985. ce estimates are for calendar year 1984,

“Residential Energy Consumption Survey estimates for fuel oil include estimates for
kerosene.

Nore: The Residential Eneray Consumption Survey is conducted every 3 years.

Sources: The Residential Energy Consumption Survey data on which the 1990 ratios
are based are from Household Energy Consumption and Expenditures 1990, ooe/en-
0321(90) (Department of Energy, February 1993); data for earlier periods are from Con-
sumption and Expenditures, Part 1: National Data, voe/ew-0321(85) and voE/e1A-0321(87)
(Department of Energy, 1987).

Monthly Labor Review December 1994 51



Comparative Analysis

Table 6. Comparison of money income before taxes, Consumer Expenditure (ce) Survey
and Current Population Survey (cps), 1988—91

‘Tggregate money income betore

Income category taxes, ce Survey’ (in billions) Ratio of ce Survey to cps
1988 1969 1990 1991 1968 1989 1990 1991
Money income before taxes? ....... | $2,604 | $2,987 | $3,077 | $3,300 | 05 | 087 | 087 | 090
Wage and salary income 2.086 | 2.228 | 2344 | 2.502 | 87 87 | 90 93
Self-employment income... 170 | ‘243 } ‘225 | 250] 84 | 108 | 98 | 1.11
Social Security and retirement
income . zor {| 325 | 332 | 351 | 98 | 102 | 97 97
Property income ........ se} 120] 103] 114] 43 48) 39 46
Unemployment, workers’
compensation, and veterans’
DENIS eee eevee ee eeees 23 20) 21 24} 80 | 66 | 59 52
Public assistance and
Supplemental Security Income... | 21 20{ 23 ze| 26 | 77 | .79 80
Regular contributions and other
income . . cee 28 33 30 33 75 80 63 68

‘ce data are tor complete reporters of income.

Nore: Ratios are based on unrounded data.

2 Excludes the value of food stamps, meals as pay, and rent as pay.

Source: cps data are from Money Income of Households, Families, and Persons in the United States (Annual), Series P-
60, No. 172, tables 33 and 63, and Series P-60, Nos. 174 and 180, table 34 (Bureau of the Census, published annually).

those in the Residential Energy Consumption
Survey after adjustments are made for differences
in population and expenditure coverage. Ratios
for electricity expenditures are more volatile, but
the data for 2 out of the 3 years for which com-
parisons are made show that the two sources are
close to each other, Out-of-pocket estimates of
health care expenditures reported in the CE Sur-
vey are about 30 percent lower than those in the
National Health Accounts. That level mainly re-
flects 40 percent lower estimates for drugs, medi-
cal supplies, and professional services. For most
years compared, CE estimates for hospital care
and medical equipment are close to those in the
National Health Accounts. CE estimates for the
median market value of a home and median ex-
penditures for mortgage principal, mortgage in-
terest, rent, and water and sewer service com-

Footnotes

pare well with those in the American Housing
Survey. Ratios of CE and American Housing Sur-
vey estimates are volatile among the homeowner
and renter utility expenditure categories.

Aggregate income estimates derived from the
CE Survey are close to CPS estimates for wages
and salaries, as well as Social Security and re-
tirement income. CE Survey estimates for prop-
erty income, unemployment compensation,
workers’ compensation, and veterans’ benefits
are historically low compared with CPs estimates,
indicating underreporting in the CE.

‘THE CE SURVEY COMPARES WELL with the inde-
pendent sources studied, and the ratios are gen-
erally consistent over the periods studied. BLS
will continue to monitor its results from, and de-
velop improvements to, the CE Survey. in

! Raymond Gieseman, “The Consumer Expenditure Sur-
vey: quality control by comparative analysis,” Monthly La-
bor Review, March 1987, pp. 8-13.

2E. Raphael Branch, “Comparing medical care expendi-
tures of two diverse U.S. data sources,” Monthly Labor Re-
view, March 1987, pp. 15-18.

3 Data were published separately for 1980-84, Beginning
with 1984, published data are integrated using the two sur-
vey components.

“Income in the cE Survey is defined as the combined in-
come earned by all consumer unit members 14 years or older
during the 12 months preceding the interview. Income is
measured using complete reporters, that is, consumer units
reporting at least one of the major sources of income: wages
and salaries, self-employment income, Social Security, pri
vate and government retirement income, interest, dividends,

54 Monthly Labor Review December 1994

rental income, other property income, unemployment and
workers’ compensation, veterans’ benefits, public assistance,
Supplemental Security Income, food stamps, rent as pay,
meals as pay, and regular contributions for support, such as
alimony and child support. Note that even complete income
reporters may not have provided a full accounting of all i
come from all sources.

5 Sample surveys are subject to two types of errors: non-
sampling and sampling. Nonsampling errors can be attrib-
uted to many sources—for example, errors in data collec-
tion, response, processing, coverage, and estimation of miss-
ing data. The full extent of nonsampling error is unknown,
although the levels of expenditures are probably understated
because of difficulties with recall on the part of respondents,
Sampling errors occur because observations are not taken
from the entire population. For more information on the re-
liability of ce Survey data, see Consumer Expenditure Sur-



Comparative Analysis

Ratios which show volatility and those which
are very low may reflect some differences in
content or methodology that could not be com-
pletely reconciled, or they may reflect under-
reporting in the CE Survey. For example, ratios
for alcoholic beverages, household textiles, and
major appliances show that CE estimates for these
items are well below 50 percent of PCE estimates.
Discrepancies between 1989 and 1990 ratios may
partly reflect changes made in the 1992 revisions
to PCE, which did not affect the data for 1989.

Other data sources on expenditures

Detailed food comparisons. Table 2 compares
detailed estimates of food expenditures from the
diary component of the CE survey with similar
estimates in PCE and in two food trade associa-
tion sources—Supermarket Business'' and Pro-
gressive Grocer.'? The estimates for total food
at home are consistently lower than PCE estimates
and consistently higher than the trade associa-
tions’ estimates. This is also true of estimates
for the detailed food category data, with a few
exceptions. CE estimates for expenditures on fish
and seafood are consistently more than 20 per-
cent higher than PCE estimates and are also higher
for expenditures on eggs and fresh milk and

cream. CE estimates for expenditures on fresh
fruits and vegetables are lower than comparable
estimates of the trade associations.

In general, CE estimates are higher than trade
association estimates because of differences in
coverage among the surveys. Supermarket Busi-
ness conducts a comprehensive annual survey of
food manufacturers, packers, wholesalers, and
retailers to construct a detailed picture of gro-
cery store sales by product line. Total grocery
store sales for the study are based on Census
Bureau estimates and include sales by specialty
food stores. Estimates are also available annu-
ally from the Progressive Grocer Company,
which conducts a similar study that is published
in Progressive Grocer magazine. These data
cover stores with annual food sales of $2 million
or more, accounting for 75 percent to 80 percent
of grocery store food sales.

Residential Energy Consumption Survey. The
Energy Information Administration conducts the
Residential Energy Consumption Survey every
3 years. The survey consists of two components:
the Energy Supplier Survey, from which data on
energy consumption and expenditures are ob-
tained, and the Household Survey, from which
data on demographic characteristics of house-

Table 2. Comparison of aggregate expenditures for food, diary component of Consumer Expenditure (ce) Survey,
Personal Consumption Expenditures (PCE), Supermarket Business, and Progressive Grocer, 1989-92

Aggregate connor Ratio of ce Survey
‘expenditures, diary to tr ociations
Food ry component, ce Survey Ratio of ce Survey to PcE rade ass
atego (in billions) ‘Supermarket Business Progressive Grocer
i9e9 | 1990 | 1991 { 1992 | 1989 | 1990 | 1991 | 1992 | 1989 | 1990 | 1991 | 1992 | 1989 | 1990 | 1997 | 1992

Total ................ | $225.5 | $235.8 | $253.8 | $259.3 | 0.71 | 0.70| 0.74] 0.74 | 1.05 | 1.06 | 1.09 | 1.10 | 1.49 | 1.16 | 1.22 | 1.20
Cereals and cereal

products... 125] 124] 141) 141] 63/ 62] 65] 64] 1.07] 99 | 1.06 | 1.02 | 1.38 | 1.90 | 1.43 | 1.16
Bakery products 21.9) 231) 263) 27.0] 62] 61] 64] 68 | 1.00} 1.01 | 1.06 | 1.08 | 1.06 | 1.05 | 1.12 | 1.23
Beet, pork, other

meat,and poultry.) 48.7) 537/ 583] 584) 79| 78; 82] .81| .94 | 1.01 | 1.07 | 1.08 | 1.01 | 1.02 | 1.07 | 1.14
Fishandseafood...|  7.8/ 7.9/ 7.9] 7.7] 1.25] 1.23] 1.29] 1.23 | 1.01 | 1.22 | 1.19 | 120 | 2.25 | 263 | 268 | 2.80
Eggs : 32| 29) 30) 28) 4.15] 1.13] 1.19] 1.08 | 1.94 | 1-82 | 2.04 | 2.07 | 1:53 | 1.36 | 1.44 | 1.50
Fresh milk and

cream . 141] 135] 126] 134] 1.12) 1.10] 1.15] 1.21 | 2.08 | 1.81 | 1.74 | 1.80 | 227 | 1.93 | 1.86 | 1.49
Other dairy

products...... 15.0) 150} 161} 168) .73| .72] 76] .78 | 1.37 | 1.20 | 1.38 | 1.40 | 1.54 | 1.25 | 1.92 | 1.20
Fresh fruits and

vegetables....... 242 23.7) 25.4) 25.4] 68] 87| 92] 90] @5| 74] 73] 70} 99] #8] 92] 9
Processed fruits

andvegetables...] 13.5] 149] 157/ 165] 58] 57} 60) .62| 97 | 1.07 | 1.06 | 1.11 | 1.26 | 1.30 | 1.37 | 1.49
Sugar and other

sweets .... 82] 9.4 99} 102] 36] 34] 36] .37 | 1.18 | 1.25 | 1.32 | 1.35 | 2.23 | 2.38 | 2.48 | 218
Fats and oils $6] 66) 70) 72] .74| 72) 76] 78} a | 1.02 | 1.09 | 1.13 | 1:46 | 1.67 | 1.74 | 1.36
Nonalcoholic

beverages ...... 207; 206{ 219) 213] 52) 81] 63] 51} 1.06] 1.03] 1.02] 98 | 1.21] 1.15 | 1.20 | 1.14
Miscellaneous

Preparedfoods...| 90.1] 324] 36.6] 38.5] .78| 76] 80] .83 | 1.15 | 1.17 | 1.28 { 1.30 | 1.05 | 1.07 | 1.16 | 1.16

Source: Consumer Expenditure Survey, annual data. pce estimates are

Published in “Nationa! Income and Product Accounts,” Survey of Current Business
{Bureau of Economic Analysis, July 1990-92 and August 1993). Detailed pce estimates are from unpublished annual pce data. Other estimates are from
“Consumer Expenditure Study,” Supermarket Business, FM Business Publications,

Inc., September, 1990-93; and “The [year] Supermarket Sales Manual,”
Progressive Grocer, Maclean Hunter Media, Inc., July 1989-92,

50 Monthly Labor Review December 1994



Comparative Analysis

Table 4. Comparison of estimated aggregate expenditures for health care, Consumer
Expenditure (ce) Survey and National Health Accounts, 1988-92

ce Survey Ratio of cz Survey to
Expenditure category (in billions) National Health Accounts

1988 | 1989 | 1990 | 1991 | 1992 | 1988 | 1989 | 1990 | 1991 | 1992

h care, total’. $74 | $81 | $85 | sas | $90 0.71 | 0.75 }0.73 | 0.71 | 0.70

Medical commodities ... 28 | 31| 33 | 34] 98} 69 | 71] 68) 6] .71

Drugs and supplies .- 22] 26| 26] 27| 30| 64 | 65] 64 | 61) 61

Medical equipment .. 5| 7] 6] 7] 7 | 92 | 1.10] 94 | 1.00 | 1.00

Medical services, total . 46 | so| 52] s2| s2| 73 | 77| 77 | 75| «9
Professional services 37 | 41| 46] 44 | 44} 70 | 75] 78 | 72
Hospital care 9| 9) 7] 9] 8] 86] 91] 66 | 91

National Health Accounts.

are relatively consistent, with very moderate
variations in the total and major components.
Most of the difference between out-of-pocket es-
timates from the CE Survey and the National
Health Accounts reflects the difference in the
kind of data used to derive the estimates, namely,
household versus administrative data. Also, some
of the difference can be attributed to differences
in the populations covered by the two sources.
(That is, military on post and U.S. citizens liv-
ing abroad are counted in the National Health
Accounts, but not in the CE Survey.) CE estimates
for medical equipment and (except for 1990)
hospital care are very close to the National Health
Accounts estimates, reflecting the use of CE data
as part of constructing out-of-pocket estimates
in the National Health Accounts.

American Housing Survey. This longitudinal
household survey is conducted by the Bureau of
the Census for the Department of Housing and
Urban Development every other year. The Ameri-
can Housing Survey provides information on the
housing inventory, characteristics of occupants,
and housing costs. In 1991, approximately
55,000 households!” were interviewed from July
through December. Beginning in 1989, the De-
partment of Housing and Urban Development re-
vised the method of collecting data on electricity
and natural gas expenditures to correct for over-
Teporting of about 15 percent to 20 percent. For the
1991 estimates, the weights are based on the 1990
Census of Housing, and the estimates include
changes made by the Census Bureau since then.!®

Comparisons of the CE Survey and American
Housing Survey data cover selected expenditures
for owned and rented dwellings, utilities, fuels,
and public services. For comparability, BLS uses
the 1991 historical estimates, which include 1980
census-based weights. Comparisons are based on
medians rather than means, because the Ameri-

52 Monthly Labor Review December 1994

‘ Excludes health insurance premiums, nursing home care, and medical equipment repairs.
Nore: Sums may not equal totals due to rounding. ce categories have been grouped as needed to match those of the

Source: National Health Accounts data used to obtain the ratios are from Health Care Financing Administration, “Na-
tlonal Health Expenditures, 1993,” Health Care Financing Review, Fall 1994.
Lr

can Housing Survey publishes only medians. In
general, no assumptions are made about the sur-
rounding data when evaluating data at the me-
dian. Therefore, the ratios are a very rough sig-
nal of differences between the two surveys.

Table 5 shows that in 1991, the medians for
several categories of the two distributions were
relatively close. For example, ratios for the mar-
ket value of owned homes were more than 90
percent and ratios for mortgage principal and
interest were 85 percent or more. The 1989
change in the American Housing Survey’s meth-
ods for collecting data on electricity and natural
gas expenditures may partly explain the closer
medians than those observed in previous years.
Medians for trash and garbage collection expend-
itures, as well as expenditures for water and
sewer, were also closer beginning in 1989. The
ratios for several categories fluctuate over the
1985-91 period. Some of the divergence may
reflect differences in the reference period over
which the data are collected and differences in
housing unit coverage, as well as revisions to the
American Housing Survey.

Income comparisons

Current Population Survey. The Bureau of the
Census collects income data in the March
Supplement to the Current Population Survey
(cPS). The CPs interviews approximately 60,000
households consisting of the U.S civilian
noninstitutional population and members of the
Armed Forces living in the United States. Income
data are collected for each person in the sample
who is 15 years or older.!9

There are several notable differences between
the CE and the cps. The CPs collects data on in-
come in March for the previous calendar year.
In contrast, income data in the CE Survey are
collected in the second and fifth interviews of



vey, 1990-91, Bulletin 2425 (Bureau of Labor Statistics,
September 1993)

© At approximately 5-year intervals, when the results of
the quinquennial censuses become available, the Bureau of
Economic Analysis establishes the levels (benchmarks) of
Pce and its components as part of the comprehensive revi-
sion of its Input-Output Accounts for the U.S. economy. For
a discussion of the 1982 benchmark revision, see “Bench-
mark Input-Output Accounts for the U.S. Economy, 1982,”
Survey of Current Business (Bureau of Economic Analysis,
July 1991), pp. 30-71

7 Annual revisions update Pct by interpolation or extrapo-
lation, using current data mostly from the Annual Retail
Trade Survey and the Monthly Retail Trade Survey of the
Bureau of the Census, and include revisions to the PcE meth-
odology. The Pce’s annual revisions affect the data for 3
years, in this instance, 1990 through 1992. Therefore, data
for prior years may not be comparable with data for these
years, See “Annual Revision of the U.S. National Income
and Product Accounts,” Survey of Current Business (Bureau
of Economic Analysis, August 1993), pp. 9-51; and “Na-
tional Income and Product Accounts,” pp. 52-119.

8 See stub expenditure categories in Consumer Expendi-
ture Survey, 1990-91 (Bureau of Labor Statistics, Septem-
ber 1993).

9ce Survey data comparisons cover published ce Survey
estimates. Historical ce Survey data on rental equivalence
are available for comparison from the ats Division of Con-
sumer Expenditure Surveys.

‘Percent reporting is a weighted average percent of con-
sumer units reporting an expenditure on a category. ts tabu-
lates quarterly weighted percents reporting, which are avail-
able from the Division of Consumer Expenditure Surveys.
The coefficient of variation is a statistic derived by dividing
the standard error by the mean. The coefficient-of-variation
percent is used to assess the reliability of an estimate and to
compare reliability across estimates.

'! Supermarket Business, Inc., “Consumer Expenditure
Study,” Supermarket Business (FM Business Publications,
Inc., September issues, 1990-93).

' Progressive Grocer Company, “The [year] Supermar-
ket Sales Manual,” Progressive Grocer (Maclean Hunter
Media Inc., July issues, 1989-92).

9 See Household Energy Consumption and Expenditures,
1990, DOE/EIA~0321(90) (Energy Information Adminis-
tration, February 1993), Appendix A.

'4 Total expenditure estimates of the Residential Energy
Consumption Survey include imputations for the money
value of utilities included in residential rents. These totals
were used in previously published comparisons between the
ce Survey and the Residential Energy Consumption Survey.

'S For a complete discussion of the National Health Ac-
counts, see “National Health Accounts: Lessons from the
USS. Experience,” Health Care Financing Review (Health
Care Financing Administration, Summer 1992).

'6 Data used for this article are from “National Health
Expenditures, 1993,” Health Care Financing Review (Health
Care Financing Administration, Fall 1994).

17 A household is defined in the American Housing Sur-
vey as all the persons who occupy a housing unit. Thus, by
definition, the count of households is the same as the count
of occupied, housing units. Households may be larger than
consumer units, the unit of measure in the ce Survey.

'8 American Housing Survey for the United States in 1991,
Current Population Reports, No. H150/91 (Department of
Commerce and Department of Housing and Urban Devel-
opment, April 1993).

'9 For a complete description of the crs, see Money In-
come of Households, Families, and Persons in the United
States, 1988 and 1989, Current Population Reports, Series
P-60, No. 172 (Bureau of the Census, July 1991).

2 Jbid., see tables 33 and 63; Series P-60, No. 174, Au-
gust 1991, table 34; Series P-60, No. 180, table 34.

Monthly Labor Review December 1994 55



E. Raphael Branch

E. Raphael Branch is an
economist in the Office of
Prices and Living
Conditions, Bureau of
Labor Statistics.

The Consumer Expenditure
Survey: a comparative analysis

The Bis Consumer Expenditure Survey

compares well with data from other
sources and provides confidence
in its estimates

s part of postsurvey evaluations, the Bu-
A= of Labor Statistics compares results

from the Consumer Expenditure (CE)
Survey with data from independent sources. The
comparisons are used to monitor the consistency
of results from the CE Survey and help identify
areas in which the survey can be improved. The
primary comparison is with Personal Consump-
tion Expenditures (PCE), a component of the Na-
tional Income and Product Accounts of the Bu-
reau of Economic Analysis. When data cannot
be compared for conceptual reasons, compari-
sons with other independent sources are made.
In addition, comparisons are made with sources
designed to collect data for a specific category
of the CE Survey, such as food or energy.

Two earlier articles in the Review compared
1980-84 CE Survey estimates with data from in-
dependent sources. Raymond Gieseman com-
pared estimates from the interview component
of the CE Survey with PCE data.’ He also com-
pared detailed estimates of food expenditures
from the diary component of the CE Survey with
PCE and trade association data. E. Raphael
Branch compared CE Survey estimates of out-
of-pocket expenditures for health care with esti-
mates of these same expenditures from the Na-
tional Health Accounts of the Health Care
Financing Administration.” The main difference
between this article and the others is that it com-
Pares more recent, integrated CE Survey results
with estimates from updated and revised sources.
The article also compares CE Survey expendi-

ture estimates with estimates from the Residen-
tial Energy Consumption Survey and the Ameri-
can Housing Survey. In addition, it includes com-
parisons of CE Survey estimates of income with
income estimates from the Current Population
Survey (CPs). Because the CE Survey is based on
integrated results and revisions exist in all the
data sources (particularly in PCE), ratios pre-
sented in this article should not be compared with
those in the earlier articles.

The ce Survey described

The CE Survey has collected data from house-
holds annually since 1980 and at approximately
10-year intervals before then. It consists of two
components: a diary, or recordkeeping survey,
and a quarterly interview survey. Both compo-
nents query an independent sample of 5,000
households in areas representative of the total
U.S. civilian noninstitutional population. This
population excludes persons in the military liv-
ing on post. The interview component, which
covers about 95 percent of all expenditures, in-
cludes questions about large expenditures such
as purchases of property and automobiles, as well
as data on expenditures that occur on a regular
basis, such as utility payments. The diary com-
ponent is designed to obtain detailed data on
small, frequently purchased items that are nor-
mally difficult for respondents to recall—for ex-
ample, food, beverages, and housekeeping sup-
plies (including laundry detergent, soap, and

Monthly Labor Review December 1994 47



the consumer unit and refer to the previous 12
months from the date of the interview. These in-
terviews may occur anytime during the year.
Missing CPS income data (attributable to
nonresponse to questions about income) are im-
puted on the basis of demographic characteris-
tics. By comparison, CE income estimates are for
complete income reporters only; missing income
data are not imputed in the CE Survey. Neither
procedure accounts for underreporting by the
respondent, which is especially prevalent in re-
gard to property income.

Table 6 shows that over the 1988-91 period,
estimates of total income compare well with
similar estimates from the cps.” Total income
before taxes for the CE Survey was 85 percent to
90 percent of the CPS. This reflects comparative
levels for wages and salaries and Social Secu-
Tity and retirement income. Some differences are
expected because the population covered in the
CPs is about 3 percent larger than that covered in
the CE Survey. The low ratios for property income
reflect imputations for missing data in the cps and
the result of underreporting in the CE Survey.

ce Survey compares well

The preceding analysis shows that estimates from
the CE Survey are generally lower than those from
PCE of the National Income and Product Accounts,
primarily because of two factors: differences in
definitions and methods that cannot be completely
teconciled and population coverage. Particularly
low ratios may indicate underreporting in the CE
Survey; for example, CE-to-PCE ratios for expenditures

on alcoholic beverages, household textiles, and major

appliances are well below 50 percent.

Comparisons between expenditure estimates
from the CE Survey and other sources reflect dif-
ferences between household and administrative
data, as well as the different purposes for which
the data are collected. The comparisons show that
estimates of detailed food expenditures from the
diary component of the CE Survey are almost
always higher than those of food expenditures
reported in Supermarket Business and Progres-
sive Grocer because of differences in coverage
among the sources. CE estimates of expenditures
for natural gas and fuel oil are relatively close to

Table 5. Comparison of annual median expenditures for shelter and utilities, Consumer
Expenditure (ce) Survey and American Housing Survey, 1985-91

Ratio of cE Survey to American
Expenditure category ce Survey Housing Survey (medians)
1985, 1987 1989 1991 1985 1987 19869 1991
Market value of owned home $61,750 | $68,749 | $71,000 | $80,000] 0.99 1.01 0.94 1.00
Homeowner expenditures’ .........
Mortgage principal and interest 3,300 4,008 4,704 4,924 89 92 90 85
Property taxes . — 622 728 829 855| 1.06 1.40 1.10 1,00
Property insurance ... 234 256 256 377 89 85 79 1.05,
Electricity? . . 696 792 B18 879 1 99 1.18 1.48
Natural gas? 516 480 471 479 77 a7 96 95
Fuel oil... eee . 725 529 570 563 92 73 79 72
Trash and garbage collection .... 78 85 87 720} 7 73 7
Water and sewer service . 194 184 208 234 95 85 87 89
Renter expenditures
Rent’... . 3,096 3,468 3,600 4,050 87 90 86 85
Electricity? ... 408 420 494 624 79 77 1,00 1.02
Natural gas* ..... ce ceee 372 276 294 278 31 72 91 83
‘Trash and garbage collection 67 7 101 96 e& 64 84 80
Water and sewer service ..... 134 159 199 208 74 83 98 91

‘ce homeowners are consumer units living in an owned sample unit. American Housing Survey data are for households
living in owner-occupied housing units. Estimates trom both surveys exclude data on second homes and vacation homes

2 Beginning in 1989, the American Housing Survey collection method for electricity and natural gas was revised to correct.
overreporting of about 15 percent to 20 percent. The rasulting estimates are lower and may not be comparable with esti-
mates for previous years. The American Housing Survey refers to natural gas as piped gas.

* American Housing Survey data are not available.

“ce renters are consumer units living in rented sample units. American Housing Survey data are for households living in
renter-occupied housing units. Both surveys’ data exclude housing units rented for vacation.

Sce and American Housing Survey data are for contract rent, which includes fuel and utilities costs that are part of the rent
payment.

Nore: Market value is estimated by the reference
the past 12 months unless otherwise noted.

Sources: ce Survey data are from the Bureau of Labor Statistics, Division of Consumer Expenditure Surveys. American
Housing Survey data are from American Housing Survey for the United States (biennial). The 1991 American Housing
Survey median value of owner occupied units is from table 3-14. The 1991 American Housing Survey housing costs are
from Appendix C, table 13, Current Population Reports, No. H150/91 (Bureau of the Census and Department of Housing
and Urban Development, Office of Policy Development and Research, 1991), pp. C-30-C-31. American Housing Survey
estimates of contract rent are from the Department of Housing and Urban Development, Office of Economic Atfairs

Person or householder as of the time of interview. Housing costs are for

Monthly Labor Revie

‘w December 1994 53



Comparative Analysis

paper products). Published data are integrated
using both the interview and diary components to
provide a complete picture of spending.*

CE Survey income estimates in this article are
from the interview component and are used in
the integrated CE Survey publications. Income
data are collected in the second and fifth inter-
views, during which households are asked to re-
port their income for the 12 months prior to the
date of the interview.*

Methodology. The basic method of evaluating
the CE Survey is to compute ratios of CE Survey
estimates of aggregate expenditures to estimates
from independent sources. Because the CE Sur-
vey and the independent data sources are con-
structed for different purposes, there are differ-
ences in definitions and estimation procedures
that must be reconciled before making the com-
parisons. Where possible, adjustments are made
to account for differences in content or concepts.
Not all of the differences between the CE Survey
and the independent data sources can be recon-
ciled. Sampling errors account for some of the
differences.5 The remaining differences are most
likely due to dissimilar concepts, different esti-
mation methods, or irreconcilable content be-
tween categories.

Personal Consumption Expenditures

Estimates of PCE represent the market value of
goods and services purchased by the entire per-
sonal sector of the U.S. economy and by parts of
the institutional population. Included in PCE are
purchases of goods and services by individuals;
operating expenses of nonprofit institutions; and
the value of food, fuel, clothing, rented dwell-
ings, and financial services received in kind by
individuals. The estimates are derived by com-
plex methods that trace the flow of goods and
services through the economy,

The primary sources of information for PCE
are Census Bureau data, such as data from the
Census of Manufactures, Census of Retail Trade,
and Census of Service Industries. Many other
data sources are used, including publications
from other government administrative and regu-
latory agencies and private organizations (trade
sources). Benchmark estimates of PCE are based
on data collected approximately every 5 years in
the Census of Manufactures and other quinquen-
nial censuses. PCE data used for the comparison
between the CE Survey and PCE in this article are
annual estimates based on the 1982 benchmark
revision® and include annual revisions through
1992,”

The CE survey and PCE are compared by
matching detailed estimates from the two sources

48 Monthly Labor Review December 1994

at the lowest level of published categories in the
CE, wherever possible.® Once matched, the data
are summed to higher levels of aggregation, and
ratios for all levels are calculated. Broad catego-
ries are occasionally combined to achieve fur-
ther comparability. For example, utilities and
public services are combined with rent in order
to improve the comparison. This is necessary
because contract rent estimates in the CE Survey
include utility expenditures paid as part of rent,
and the CE Survey estimates of utility expendi-
tures do not include such amounts. Adjustments
are also made to selected detailed CE Survey cat-
egories to account for conceptual differences
between the two sources. For instance, CE Sur-
vey estimates for new vehicle trade-in allowances
are added to estimates of net payments for new
vehicles to approximate the total value of new
vehicles as measured in PCE. Another data ad-
justment is made to used vehicle estimates in the
CE Survey: new car trade-in allowances and the
values of sold, lost, or damaged vehicles are de-
ducted from net used-vehicle estimates to approxi-
mate the net value of used vehicles in the PCE.
The following expenditure categories are not
compared because of conceptual differences that
could not be reconciled: homeowner shelter,
capital improvements, health care, insurance, and
finance charges. Homeowner shelter expendi-
tures are not compared because PCE measures
owned dwellings using a rental equivalence ap-
proach, a concept that is not in the CE Survey.?
Capital improvements and finance charges are
excluded because they are not covered in PCE.
Health care expenditures are not compared be-
cause PCE includes expenditures by consumers
plus governments, commercial insurance com-
panies, and other third parties. By comparison,
the CE Survey covers only the out-of-pocket ex-
penditures paid by consumers. These exclusions
do not account for all the differences between the
CE Survey and PCE. Adjustments are made for the
remaining differences to the extent possible.

Results. Results of comparing selected compo-
nents of the CE Survey and PCE for 1989 through
1992 are shown in table 1. The ratios indicate
that CE estimates for almost all categories of con-
sumption are lower than PCE estimates. PCE data
are based mostly on administrative and estab-
lishment data, which we expect to be more com-
plete, whereas the CE data are collected via a
household survey, which is subject to under-
reporting. In addition, the lower CE Survey esti-
mates may reflect broader population coverage
in the PCE.

The relationship between the two series is
fairly consistent over time for most comparable
category estimates, and the level of several CE



Survey estimates compares well with PCE. For and services, transportation, and household op-
example, CE estimates are 93 percent or more of _ erations. This is consistent with the relatively
PCE for rent, utilities, and public services, as well high reporting rates for these expenditure cat-
as gasoline and motor oil. Also, CE estimates are egories and relatively low coefficients of varia-
at least 80 percent of PCE estimates for apparel _ tion, which suggest low sampling error.!°

Table 1. Comparison of the Consumer Expenditure Survey (cE) with Personal
Consumption Expenditures (PcE), selected expenditure categories, 1989-92

ce Survey (In billions) Ratio of ce Survey to PCE
1989 1990 1991 1992 1989 1990 1991 1992

$390 | $408 | $410 | $420 | 0.78 | 0.76 | 0.75 | 0.75
229 | 240 | 259 } 264 Bal 70 74

Expenditure category

Food at home ...-

Food away from home’ 161 16g | 151 156 89 87 78
Alcoholic beverages : . 27 28 29 30 40 39 38
Rent, utilities, and public services? . .| 285 | 297 | 305 | 328 95 95 93

Rented dwellings, total.........0...000,
Utilities, fuels, and public services...

163 | 171 171 192 | 1.05 | 1.04 | 1.00
176} 183 | 195 | 198 89 90 91
54 57 61 62 | 1.05 | 1.07 | 1.08

Telephone .
Household operations’ 22 ral 22 24 95 85 92
Household furnishings and equipment 4143 148 159 160 68 68 7
Household textiles . . 10 10 10 9 49 45 45
Furniture . 30 30 29 32 Bt 82 78
Floor coverings. 7 9 W 7 59 76 99
‘Major appliances: . 16 16 15 16 63 62 S7

‘Small appliances and miscellaneous

household equipment’... 80 83 94 95 69 68 74 ”
Apparel and services ... 155 | 160 | 171 | 172 82 cy] 85 80
Transportation .... 379 378 387 399 85 81 87 84
Vehicle purchases® ... je | 182 | 187 | 194 | 1.04 99 | 1.11 | 1.04
Gasoline and motor oil... 94} 102 97 97 | 1.00 95 97 96
‘Other vehicle expenses 63 87 74 go } 52 53 58 $8
Public transportation... 25 27 28 28} 60 59 63 61
Entvrtainment......... settee 1390 | 129 | 136 | 141 67 61 62 | 61
Fees and admissions ..................| 36 36 37 33 | a6 | 77 | 76 | 72
Televisions, radios, and sound equipment | 41 44 46 49 | 63 | 63 | 61 |] 62
Pets, toys, and playground equipment ...| 24 27 26 27 | 69 70 {| 67 | 68
Other entertainment supplies and
equipment... eeeeeeeeeees 87 44 54 53 54 | 40 48 A4
Personal care products and services ......] 35. 35 39 39 | 63} 59 64} 61
Reading 0.000.066 cece ceeseeceeeee 19 19 20 2 50 46 | 48 45
Tobacco products and smoking supplies ...| 25 a7 27 27 | 62) st 60 | 54
Miscellaneous’ ........ 33 33 31 34] 34 32 29 30

‘ Excludes school lunches and meals as pay.

? includes rent for tenant-occupied dwelling units and lodging away from home and at school. Rent in the ce Survey is
contract rent, which includes utilities for some renters. The ce Survey covers direct costs of utilitias and fuels by homeowners
and renters. In pce, data are for space rent, which excludes charges for utilities. pce data cover total expenditures for utilities
and fuels, even if paid by landlords.

% Excludes amounts for babysitting, day care centers, and care of invalids or the elderly.

‘Various subcategories are combined to approximate equivalent content.

5 The pce estimates are derived using estimates of dealer margin on goods purchased by persons (a concept that cannot
be matched with vehicte purchases as measured in the ce Survey) and the wholesale value of net transactions between
Persons and other sectors such as government and nondealer businesses. ct data on vehicle purchases and trade-ins
were combined to approximate the total value of new vehicle purchases. cr data on used vehicle purchases, trade-ins,
sales, and losses were combined to approximate the value of net transactions of used vehicles.

* Includes vehicle rentals, maintenance repairs, and other vehicle charges. Excludes aircraft rentals, vehicle licenses,
vehicle inspection, and vehicle registration.

7 ce estimates exclude expenditures for other properties.

Nore: Sums may not equal totals due to rounding. Expenditure estimates for home ownership, insurance, capital im-
Provements, health care, finance charges, education, and cash contributions are excluded from the comparisons.

‘Sources: For information on the ce Survey, see Consumer Expenditure Survey, 1990-91, Bulletin 2425 (Bureau of Labor
Statistics, September 1993). ece data that are used in the comparisons are from unpublished detailed tabulations of the
Bureau of Economic Analysis as of September 1993. These data are based on 1982 benchmark estimates. For more
information on pce, see National income and Product Accounts of the United States: Volume 2, 1959-88 (Bureau of Economic
Analysis, 1992) and Survey of Current Business (Bureau of Economic Analysis, August 1993.)

Monthly Labor Review December 1994 49

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