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give the number of points contributed to the index by individual series. This method of computation facilitates analysis of the changes in the index. For example, it makes it possible to observe the points contributed by each series or group of series, and therefore to determine which series or group of series is responsible for the month-to-month changes in the total index or in the index for any group or subgroup of industries.

The weights used are based on value added - the difference between the value of production and the cost of materials or supplies consumed -in individual industries for selected base years. The 1967 proportions, or the relative importance of the groupings based on the 1967 weights, are shown in detail in the Federal Reserve Board publication, Industrial Production; 1971 Edition, and include a discussion of weights and weight base years back of 1967.

Components of the index are adjusted for two kinds of short-time recurring fluctuations, i.e., for differences in the number of working days from month to month and for seasonal variation. Beginning with indexes for January 1947, allowances for holiday observances have been made in seasonal factors rather than in working-day adjustments. Except for Easter, each of the principal holidays is in the same month each year - January, May, July, September, November, and December. Reported product data are converted to a daily average basis by adjusting for the number of working days in the reporting period. In these calculations Saturdays and/or Sundays, and half days, are regarded as nonworking days. No allowances for holiday shutdowns are made in the working-day adjustment; consequently, the effects of holiday observances on monthly output are reflected in the indexes unadjusted for seasonal variation. No adjustment is required for monthly series based on man-hour and kilowatt-hour data because they are little affected by calendar variations.

The seasonal adjustment factors in the index have been developed essentially by the ratio-to-moving-average method (basic method described in Federal Reserve Bulletin for June 1941). The procedures used in deriving the seasonally adjusted series are those incorporated in the X-11 version of the Census Method II electronic computer program for seasonal adjustment. A selected number of seasonally adjusted components are given professional review for further refinement.

Monthly data for 1947-70 for those series indicated by a star appear in the appendix to this volume. A more detailed description of the 1971 revision to the index, and monthly data prior to 1968 for all series, appear in Industrial Production, 1971 Edition, available (price $4.00) from the Board of Governors of the Federal Reserve System (Washington, D.C. 20551).

Sources: U.S. Department of Commerce, Bureau of the Census and Bureau of Economic Analysis. The series shown in this volume represent estimated sales and inventories of merchant wholesalers in the United States. Data for Alaska and Hawaii are included beginning January 1961. The wholesale trade series shown in the 1963 and earlier editions of BUSINESS STATISTICS included information for some types of nonmerchant wholesalers; that series has been discontinued and replaced (with data beginning 1948) by the series described below.

The estimates confined to merchant wholesalers since information on other types of wholesalers is not available except for years when the census of wholesale trade was taken. The 1972 Census of Business indicated that merchant wholesalers accounted for 45 percent of the sales and 75 percent of the inventories of all wholesale establishments.

Areas of wholesale trade not covered in this series include manufacturers' sales branches and sales offices, petroleum bulk stations, assemblers, buyers, and associations engaged in the cooperative marketing of farm products, and agents, merchandise or commodity brokers, and commission merchants.

Sales include sales of merchandise and receipts from repairs or other services to customers, after deducting returns, allowances, and discounts; sales of merchandise for others on a commission basis are also included. Local and State sales taxes and Federal excise taxes are included. Inventories represent stocks, generally at cost, of merchandise on hand for sale at the end of the month; they do not include goods held on a consignment basis or such items as fixtures, equipment, and supplies not held for sale.

The reporting firms are part of a probability sample representing merchant wholesalers in all kinds of business.

A revised sample was introduced effective with data for June 1974. (Previously published data were based on a sample drawn from the 1963 Census of Business universe and Social Security Administration lists of wholesalers entering business subsequent to 1963.) The principal elements of the present revision of the sample are: (1) The sample incorporates the results of the 1967 Census of Business which provides the latest information available on the kind-of-business classification of firms and measures of size (sales and inventories). (2) The sample was drawn from the 1971 County Business Patterns file using kind-of-business codes derived from the 1967 censuses. For each firm included in the sample, selection was based upon one of the following measures, whichever resulted in the highest probability: (a) first quarter 1971 County Business Pattern payroll, (b) 1967 census sales, (c) 1967 census inventories. New wholesale employers entering business since 1971 are represented by a sample drawn from the file of new applications for an Employer Identification number (business births) maintained by the Social Security Administration. The sampling unit is the Employer Identification number assigned to each business employer. (3) The sample design incorporates a monthly match against the most current file of firms covered by the Federal Insurance Contributions Act to assure that all firms selected for the sample are currently in business, including firms which go out of business but subsequently resume operation. (4) The sample design includes an adjustment procedure which tends to reduce differences among rotating panels due solely to the chance distribution of firms among those panels.

To develop a long-term series comparable with the new sample results, previously published estimates have been revised for the period January 1964 through May 1974. The revision was accomplished by applying the ratio developed during the 4-month overlap of the two samples by kind of business as follows: For January 1972 through May 1974, the ratios were applied on a 100-percent basis to previously published data. For the remaining months the ratios were applied on a diminishing basis back to January 1964. For example, the previously published December 1971 estimates were adjusted by 96/97ths of the ratio; November 1971 was adjusted by 95/97ths of the ratio, etc. This procedure has been followed since it appears that influences contributing to the differences between the two samples occurred gradually over that period.

Earlier figures were based on samples selected from the 1948, 1954,

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Source: U.S. Department of Commerce, Bureau of Economic Analysis. Sales are estimated aggregate dollar values and inventories are estimated book values at the end of the year or month. Business sales and inventories are here defined as the sum of the data for manufacturing and for merchant wholesale and retail trade. These figures are smaller than the non-farm business statistics used in gross national product computations by the amount of sales (or revenue) and inventories for nonmerchant wholesalers (e.g., manufacturers' sales branches, independent petroleum bulk stations and terminals, agents and brokers, etc.), mining, construction, utilities, communication, transportation, and services.

The term “sales” used here signifies essentially sales or shipments for retail and wholesale trade and billings or shipments for manufacturing.

Trade inventories are valued at cost of merchandise on hand, while manufacturers' inventories are, in general, valued at the lower of cost or market price. About one-fifth of manufacturers' inventories are valued on a last-in-first-out (LIFO) basis; the use of LIFO is much less prevalent in trade generally (though it is used extensively by department stores and food stores).

Changes in the book value of business inventories reflect movements of replacement costs as well as changes in physical volume. In measuring inventory investment as part of the gross national product, the data are adjusted to remove the effect of changes in replacement costs. (See explanation of "inventory valuation adjustment" in note 1 for p. 7.)

The annual totals shown here for manufacturing and trade sales are based on unadjusted data; in the case of the manufacturing segment the unadjusted figures, as well as the seasonally adjusted data, include adjustments for trading-day and calendar-month variation.

and 1958 Censuses of Business, and were adjusted to the level of the sample selected from the 1963 Census. The earlier estimates are extrapolations using data collected by the Census Bureau in the past, compiled with different samples.

Comprehensive details for the descriptions of the different samples, estimating procedures, etc., as well as estimates of merchant wholesalers sales and inventories, unadjusted and seasonally adjusted, by kind of business, appear each month in the Monthly Wholesale Trade Report. (See also the February 1961, February 1966, and July 1974 Monthly Wholesale Trade Reports for details concerning the introduction of the revised samples.) These publications are available from the Bureau of the Census, Washington, D.C., 20233.

The sales and inventory data are adjusted for seasonal variation and, in the case of sales, also for trading-day differences, by the use of factors developed by the Bureau of the Census using the X-11 version of the Census Method II seasonal adjustment program. A description of this technique is available from the Chief, Business Division, Bureau of the Census.

Seasonally adjusted monthly data for 1948-70 for merchant wholesalers' sales and inventories for the series shown here appear in the appendix to this volume; unadjusted monthly data for 1964-74 for total merchant wholesalers' sales and inventories and for total durable and nondurable goods establishments appear on pp. 45-46 of the December 1974 SURVEY; those for earlier periods are available upon request. (See also the Supplement to the Monthly Wholesale Trade Report, issued January 13, 1967 and current issues of the Monthly Wholesale Trade Report, available from the Bureau of the Census.)

The estimates are obtained from a sample of companies exporting durable goods that accounted for approximately 75 percent of the value of such products exported. The reporting panel was originally developed from the larger panel included in the Census Bureau's Survey of the Origin of Exports of Manufactured Products: 1960. The survey included all manufacturing plants of 100 or more employees with exports of $25,000 or more in 1960. The following measures were used in selecting companies to be included in the monthly survey: (1) The company was engaged in exporting durable goods according to the 1960 Survey of the Origin of Exports of Manufactured Products and such exports exceeded $5 million in 1960; and (2) the company was included in the monthly survey for the manufacturers' shipments, inventories, and orders series (described in note 2 for this page). The level of manufacturers' sales for export in October 1962 was estimated from the annual 1960 totals for each industry group to be published. The 1960 data of the establishments of the companies classified in each industry category of the survey were aggregated to company industry totals and divided into the October 1962 export sales reported by these companies. The comparable industry published totals in 1960 were multiplied by this ratio to estimate the October 1962 industry group total sales for export.

Seasonally adjusted data became available in August 1968 and were published for the first time in the September 1968 issue of the SURVEY OF CURRENT BUSINESS. The data were seasonally adjusted by the Bureau of the Census using the X-11 version of Census Method II (specifications for this method appear in Technical Paper No. 15: The X-11 Variant of the Census Method II Seasonal Adjustment Program, available from the Chief, Statistical Indicators Division, Bureau of Economic Analysis, Washington, D.C. 20230). The data have been adjusted for reporting period variations in individual respondents' reports but have not been adjusted for trading days since tests indicated no measurable trading day variations.

In addition to the estimates for manufacturers' export sales for total durable goods industries shown in this volume, the original reports, entitled Manufacturers' Export Sales and Orders of Durable Goods, Series: M4-A, provide export sales for a limited number of durable goods industry groups and export data for new and unfilled orders for durable goods industries, excluding motor vehicles and parts, and for a limited number of other durable industry groups.

A statement giving detailed information regarding methodology is available upon request from the Bureau of the Census, U.S. Department of Commerce (Washington, D.C. 20233). See also the Current Industrial Report, Manufacturers’ Export Sales and Orders of Durable Goods (Series: M4-A), 1963-June 1968, issued in August 1968 by the Census Bureau.

Monthly data for 1965-70 appear in earlier editions of BUSINESS STATISTICS (see reference note, p. 1 of this section); those for October 1962-December 1964 are shown in the following table:

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Manufacturers' Export Sales, Durable Goods Industries

(Millions of dollars)

Sources: U.S. Department of Commerce, Bureau of Economic Analysis (formerly Office of Business Economics) and Bureau of the Census. The monthly data for stock-sales ratios are based on the seasonally adjusted sales and inventory series for manufacturing and trade. The ratios for each month are derived by dividing end-of-month inventory book values by total sales during the month. The ratios for a given year are derived by dividing the weighted average of seasonally adjusted inventories (using the 13 observations including the yearend figures for the preceding and current year) by the monthly average of unadjusted sales for that year. No adjustments have been made to bring inventory book values, which are typically valued at the lower of cost or market, up to the level of selling prices.

Stock-sales ratios are frequently used in evaluating the current position of inventory holdings. While they are usedful in this respect, considerable caution must be used in such analyses. In addition to the problem of selecting a “normal” historical period for use as a frame of reference, appraisal is rendered difficult by the many cyclical and secular factors that are operative.

From a cyclical point of view, stock-sales ratios are generally inversely related to business activity; that is, the ratios tend to rise as sales decline and fall as sales rise. Typically, the change in direction of the inventory movement tends to occur some time after the turn in sales. Over the longer run, stock-sales ratios are affected by changing efficiencies in the handling of inventories due to such factors as improvements in transportation, better control by management, increasing use of electronic data processing machines, and other changes in technology.

See note 2 for p. 27 for a description of the manufacturing series; note 1 for p. 59 and note 1 for p. 63 for descriptions of the retail sales and retail inventories series, and note 4 for p. 24 for a description of the merchant wholesalers' sales and inventories series.

Monthly data for 1947-70 for the series indicated by a star are in the appendix to this volume. 2

See paragraph 1 of note 1 for this page for an explanation of yearly data for the inventory-sales ratios.

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allowances, and exclude freight charges and excise taxes. Shipments for export as well as for domestic use are included. Shipments by foreign subsidiaries are excluded, but shipments to a foreign subsidiary by a domestic firm are included. The shipments figures from the Annual Survey of Manufactures to which the current series is benchmarked include interplant transfers as well as commercial sales.

Inventory data are book values of stocks on hand at the end of the period, and include materials and supplies, goods in process, and finished goods. Inventories associated with the nonmanufacturing activities of the company are excluded from the benchmark. In general, inventories are as valued by the manufacturer.

The series for new orders represents new orders net of cancellations received during the period. Unfilled orders at the end of a reporting period are orders that have not passed through the sales account and are equal to unfilled orders at the beginning of the period plus net new orders received during the period less net sales.

The manufacturers' shipments, inventories, and orders survey provides monthly figures that are comparable to the annual totals published each year in the annual survey of manufactures. The sample panel is defined as a probability sample drawn as a subsample of the 60,000 establishments in the annual survey of manufactures. The monthly reporting panel consists of approximately 5,000 reporting units and includes virtually all companies with 1,000 or more employees and a sample of the smaller ones. The panel is supplemented on a current basis by including all manufacturing operations acquired or initiated by companies already in the sample. When company reorganizations, mergers, and changes in ownership result in new successor firms, these are retained in the reporting panel. Also, the sample is updated periodically from the list of new manufacturing concerns added to subsequent annual surveys of manufactures. The reporting unit typically comprises the entire operations of a company although at the request of the Census Bureau many of the larger diversified companies file separate divisional type reports for their operations in different industries.

Estimates of shipments, inventories, and unfilled orders are obtained for each detailed category by multiplying the estimate for the preceding month by the link relatives based on a matched sample of reporting companies or divisions. The data for each company are inflated by their sampling weights before being summarized. The figures for net new orders are derived from the shipments plus net change in unfilled orders for each industry category. Estimates for subtotals and totals are obtained by aggregating the related component categories within the series. The shipments and inventory estimates are adjusted annually to the establishment benchmark levels from the annual survey of manufactures,

The figures for manufacturers' shipments, inventories, and orders published in this edition of BUSINESS STATISTICS and beginning with the July 1973 issue of the SURVEY OF CURRENT BUSINESS reflect the latest revision of these series introduced by the Census Bureau in June 1973. (A general explanation of the major revision completed in 1963 appears in the 1965 and 1967 editions of BUSINESS STATISTICS.)

The latest (June 1973) revision reflects benchmarking the annual totals derived from the monthly survey to the annual survey of manufactures totals for each year 1970 and 1971 and carrying forward the revised level to March 1973. A small number of corrections were also introduced into the data. Also, new seasonal factors were developed for each series. No changes in methodology or sample design were made during this revision.

In June and July 1974 changes were made in the shipments and new and unfilled orders series back to 1970 (unadjusted data) and 1968 (seasonally adjusted data). The changes reflect correction of an error in the level of the monthly survey and the comparable level of the 1972 Census of Manufactures Advance Report for the complete aircraft and missiles series. The aircraft series was benchmarked to the 1972 level in order to correct the error, and seasonally adjusted data for the aircraft series was based on newly derived seasonal factors from the corrected series.

Currently, the survey shows monthly series for 30 detailed industry categories and supplementary presentation of the data by market groupings. The market groupings provide a breakdown between final products and materials and a further division of final products into consumer goods and equipment for business and government use.

There are no establishment-based estimates from the annual survey of manufactures for unfilled orders or new orders. In the 1963 benchmarking operation, a level for unfilled orders and new orders was established as of August 1962 for each industry category by applying the modified ratio (modified to adjust for incompleteness in reporting)

of unfilled orders to shipments of the monthly reporting panel to the universe estimate of August shipments derived from the annual survey of manufactures benchmark totals. In the 1973 benchmarking to the annual survey of manufactures totals for the years 1970 and 1971, it was assumed that the relationship of the unfilled orders to shipments of monthly data published since 1970 was correctly estimated even though the survey may have either underestimated or overestimated the shipments compared with the annual survey of manufactures. With minor exceptions, once the level of the shipments in an industry for 1970 to 1973 was determined, the level of unfilled orders was estimated by applying the ratio of originally tabulated unfilled orders to shipments for each month to the new shipments estimate for the month. The procedure links the January level of unfilled orders and shipments smoothly into the historical series ending in the previous December. Net new orders are derived by adding the change in unfilled orders to the shipments estimate,

The industry categories shown in the manufacturers' shipments, inventories, and orders series are groupings of industries in accordance with the definitions in the 1967 Standard Industrial Classification Manual, as amended. Corrections to historical series, made during the 1968 revision, were required because of changes in SIC classifications and revisions to individual establishment reports uncovered during the 1963 Census of Manufactures, and were made only to 1961 and subsequent years. These revisions affect chiefly the following industry categories: Communications equipment; scientific and engineering instruments and related products; ordnance; building paper; and wood products, not elsewhere classified.

The series for shipments and new orders were adjusted for the number of trading days and length of calendar month prior to seasonal adjustment. New orders are not independently seasonally adjusted but are derived from the seasonally adjusted shipments and the change in the seasonally adjusted unfilled orders. The component series were seasonally adjusted by the Bureau of the Census using the X-11 version of Census Method II (specifications for this method appear in the Bureau of the Census Technical Paper No. 15: The X-11 Variant of the Census Method II Seasonal Adjustment Program, available from the Chief, Statistical Indicators Division, Bureau of Economic Analysis, Washington, D.C. 20230).

A detailed description of the manufacturers' shipments, inventories, and orders series is shown, together with historical data for all currently available series, in the following comprehensive background reports from the Bureau of the Census: (1) Manufacturers' Shipments, Inventories, and Orders: 1947-63 Revised (Series M3-1)-issued in 1963; (2) Manufacturers' Shipments, Inventories, and Orders: Series M3-1, Supplement 2-issued November 1964; (3) Manufacturers' Shipments, Inventories, and Orders: 1961-68 (Series M3-1.1)-issued September 1968; (4) Manufacturers' Shipments, Inventories, and Orders: 1961-1970 (Series M3-1.2) issued October 1970; (5) Manufacturers' Shipments, Inventories, and Orders: 1966-71 (Series M3-1.3)-issued August 1971; (6) Manufacturers' Shipments, Inventories, and Orders: 1966-72 (Series M3-1.4, Revised)-issued September 1972; and (7)Manufacturers' Shipments, Inventories, and Orders: 1967-73 (Series M3-1.5), issued July 1973-see also two supplementary Change Sheets (issued in June and July 1974) to the aforementioned Series M3-1.5 report. Those Change Sheets provide revised data for corrections described in paragraph 8 of this note.

Current monthly data appear in the Bureau of the Census Current Industrial Reports, Manufacturers' Shipments, Inventories, and Orders: Series M3-1-issued each month.

Monthly data for 1947-70 for the series indicated by a star are in the appendix to this volume.

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articles and pottery; cutlery, handtools, and hardware; household appliances; ophthalmic goods, watches, and clocks; and miscellaneous personal goods.

Capital goods industries-this series is comparable to the previously published "producers' capital goods” and the “defense products (old series)” categories.

Nondefense industries-Machinery, except electrical (excluding farm machinery and equipment and machinery shops), electrical machinery (excluding household appliances and electronic components), and the nondefense portions of shipbuilding and repairing and railroad equipment, communication equipment, aircraft and aircraft parts, and ordnance.

Defense products-Based on separate reports on defense work filed by large defense contractors in the following industries: Ordnance, communications, complete aircraft and aircraft parts, and shipbuilding. The data are comparable to those published annually for the specified industries in the MA-175, Shipments of Defense-Oriented Industries. 3

Annual figures for market categories are based on shipments data not seasonally adjusted but adjusted for trading day and calendarmonth variation.

See note 2 for p. 30. 3

Source: Dun & Bradstreet, Inc. Figures for new business incorporations represent the total number of stock corporations issued charters under the general business corporation laws of the various States and the District of Columbia. The statistics include completely new businesses that are incorporated, existing businesses that are changed from the noncorporate to the corporate form of organization, existing corporations that have been given certificates of authority to operate also in another State, and existing corporations transferred to a new State. Data for incorporations in the District of Columbia are included beginning January 1963.

Seasonally adjusted new business incorporations beginning January 1964 utilize factors developed by the Bureau of the Census Method II electronic computer program (specifications for the X-9, X-10, and X-11 versions of Method II are available from the Chief, Statistical Indicators Division, Bureau of Economic Analysis, Washington, D.C. 20230).

Monthly data (unadjusted) for 1947-56 including Hawaii are available upon request; those for 1957-58 (unadjusted only) appear in the 1961 edition of BUSINESS STATISTICS. Monthly data for 1959 including Hawaii, and for 1960-70 including Alaska and Hawaii, appear in earlier editions of BUSINESS STATISTICS (see reference note, p. 1 of this section).

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Source: Dun & Bradstreet, Inc. A failure is defined as "a concern that is involved in a court proceeding or a voluntary action that is likely to end in loss to creditors." All industrial and commercial enterprises that are petitioned into the Federal Bankruptcy Courts are included in the failure records. Also included are: Concerns which are forced out of business through such actions in the State courts as foreclosure, execution, and attachments with insufficient assets to cover all claims; concerns involved in court actions such as receivership, reorganization, or arrangement; voluntary discontinuances with known loss to creditors; and voluntary compromises with creditors out of court, where obtainable.

The series shown for liabilities represent approximately current liabilities (i.e., all accounts and notes payable and all obligations, whether in secured form or not, known to be held by banks, officers, affiliated companies, supplying companies, or the Government). They do not include long-term publicly held obligations. Offsetting assets are not taken into account.

The failure data shown in the table are for 48 States and the District of Columbia; they do not at present include figures for Alaska and Hawaii. Data for all years shown here exclude railroad failures and such activities as banks, financial companies, holding companies, real estate and insurance brokers, amusement enterprises, shipping agents, tourist companies, transportation terminals, etc.

The classification of the failure records by industries conforms to the “Standard Industrial Classification Manual,” in order to facilitate direct comparison between failures and any other series of data based on the same official code.

The failure index relates the number of failures in each month to the number of industrial and commercial enterprises listed in the Dun & Bradstreet Reference Book. It shows the annual rate at which business concerns would fail if the number of failures and concerns listed in that month prevailed for an entire year. The index is expressed as the annual number of failures per 10,000 listed industrial and commercial enterprises. The “unadjusted” figures have been slightly adjusted to equalize, insofar as possible, the number of working days each month. Seasonal fluctuations have been removed in the adjusted index by a method using deviations from a 12-month moving average.

Monthly data for 1947-70 for the series indicated by a star are in the appendix to this volume; comparable monthly data for all series for 1939-70 (except those for the unadjusted failure indexes prior to 1955

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and the seasonally adjusted failure indexes prior to 1947, which are available upon request), together with pertinent qualifications, appear in earlier editions of BUSINESS STATISTICS (see reference note, p. 1 of this section). Comparable data prior to 1939 for the industry groups are not available because of revisions in the series in 1939 and 1940, described in earlier editions of BUSINESS STATISTICS. Monthly figures for 1936-39 (old basis) are available in the 1940 SUPPLEMENT, and earlier monthly figures on the same basis appear on pp. 17 and 18 of the December 1938 SURVEY OF CURRENT BUSINESS.

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PAGE 40

1910 to January 1935. January 1935 to September 1952. September 1952 forward.

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Source: U.S. Department of Agriculture, Statistical Reporting Service. Indexes are based on official estimates of prices (about the 15th of the month) received by farmers for their products sold at local markets-point of first sale-or at the point to which farmers deliver their products in their own conveyances or in local conveyances they hire for the purpose. (For apples, peaches, pears, strawberries, citrus products, potatoes, tobacco, wholesale milk, broilers, and wool, monthly average prices rather than midmonth prices are used in computing the index.)

The reported prices received by farmers are tabulated and averaged by crop-reporting districts. These district averages are weighted by district sales or production estimates to obtain weighted State averages and provide the primary basis for the official estimates. The State estimates of average prices are weighted by State marketing or production estimates to arrive at national averages.

In computing the subgroup indexes, the weights applied to the U.S. average prices to obtain aggregates for individual commodity groups for 1910 through 1934 were average quantities sold by farmers for the 6-year period 1924-29; from 1935 to September 1952, weights are 5-year averages of sales by farmers during 1937-41; and from September 1952 forward, average annual marketings for the period 1953-57. For livestock and livestock products, calendar-year sales were used in computing the averages; for crops, the corresponding crop-year sales were used.

For combining the various subgroup indexes into an all-crop, an all-livestock and livestock products, and an all-farm-products index, weights are percentages based on average cash receipts of farmers (with adjustments to reflect imputed weights for items not included in the index) for the three periods, 1924-29, 1937-41, and 1953-57.

There are 56 commodities represented in the index as of January 1975. These items accounted for about 93 percent of the total cash receipts from farm marketings in 1953-57. Data for some commodities are not available all the way back to 1910 (the earliest year for which the index was computed). Thus strawberries were added to the index in January 1919, 11 commercial vegetable crops in January 1924, soybeans, grain sorghums, turkeys, cantaloupes, cucumbers, and watermelons in January 1935, broccoli in January 1939, and sweet corn in January 1949. Grapes were dropped from the index as of January 1935 and green peas (for fresh use) as of January 1949. Asparagus and green peas for processing were added in September 1952. (Indexes for October 1943-June 1946 reflect wartime subsidy payments made on butterfat, milk, beef cattle, and lambs during that period.)

The items represented in each group and the percentage weights of the groups, based on average cash receipts in 1924-29, 1937-41, and 1953-57, are shown in the table below:

The indexes shown here are not adjusted for seasonal variation. The original reports also show adjusted indexes for five subgroups-fresh market fruit; fresh market vegetables; potatoes, sweetpotatoes, and dry edible beans; dairy products; and poultry and eggs.

The index of prices received by farmers was last revised in January 1959 at which time the weight base period was changed from 1937-41 to 1953-57. For further information concerning this revision see the April-July 1959 issue of Agricultural Economics Research. For additional details concerning these indexes see: (1) Major Statistical Series of the U.S. Department of Agriculture, Volume I, Agricultural Prices and Parity, Agriculture Handbook 365, (2) Agricultural Economics Research, April 1950, and (3) Agricultural Prices, Supplement No. 2, January 1954 (published by the U.S. Department of Agriculture). See also the U.S. Department of Agriculture report entitled Scope and Methods (Miscellaneous Publication No. 967) issued in December 1964.

Monthly data for 1947-70 for those series indicated by a star appear in the appendix to this volume. Annual and monthly data back to January 1910 appear in various issues of Agricultural Prices and Supplements thereto (available from the Statistical Reporting Service, U.S. Department of Agriculture, Washington, D.C. 20250). Monthly data for 1955-70 (with the exception of revised data back to 1953 for the commercial vegetables component, available in the May 1964 and May 1965 issues of Agricultural Prices, Supplement 1, and revised data back to 1959 for all farm products, crops, and feed grains and hay, available in the May 1967 issue of Agricultural Prices, Supplement 1) appear in earlier editions of BUSINESS STATISTICS (see reference note, p. 1 of this section).

(In order to facilitate comparison with other indexes, the indexes of prices received by farmers were converted to a 1967 reference base. Annual and monthly data back to 1960 are available in the June 1970 issue of Agricultural Prices, Supplement No. 2. Current monthly data appear in issues of Agricultural Prices and Supplements from July 1970 forward. The converted data supplement, but do not replace, the official series, which, pursuant to law, is published on the 1910-14=100 base.)

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Source: U.S. Department of Agriculture, Statistical Reporting Service. The Index of Prices Paid by Farmers, including Interest, Taxes, and Farm Wage Rates, is a measure of the changes that occur in the level of prices paid by farmers and their families for commodities and services used in living and farm production. In addition to commodities, the combined index (Parity Index) includes data for interest per acre on indebtedness secured by farm real estate, taxes per acre on farm real estate, and cash wage rates paid hired farm labor.

Prices paid by farmers are compiled primarily from data reported (1974) by about 20,000 independent retail merchants and chain stores, and costs of electricity and telephone services reported by about 13,000 farmers. For most groups of items, the data were collected quarterly from 1923 to 1936, annually before 1923, and monthly from 1937 to date. Most independent store surveys are made quarterly, some semiannually, and others seasonally. Feed prices, prices paid for chicks and poults, and chain-store reports on nearly all family living items are collected each month of the year. Prices paid for individual commodities are estimated by individual States, and then weighted by estimates of purchases of the commodity by farmers in each State to obtain an average for the country as a whole.

For the period 1910-March 1935, indexes for the several commodity groups were constructed by weighting prices of individual commodities by the average quantities estimated to have been purchased per farm during 1924-29; for the period March

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