Methodological note: Construction Costs Index

INDEX OF CONSTRUCTION COSTS (ICCE) OF THE AUTONOMOUS COMMUNITY OF EUSKADI. Base year 2015

The Index of Construction Costs (ICCE) is a monthly current indicator that attempts to describe the development of industrial prices in the first stage of commercialization, i.e. the ex factory sales price resulting from effective transactions, excluding freight and commercialisation costs, as well as invoiced VAT.

The Index of Construction Costs is a Laspeyres weighted index which is based on fixed weights calculated with the data from the base year. These indices have the advantage of being easier to calculate and interpret.

Last March 2019 work was completed to enable the renovation of the basis of the Industrial Price Index from 2010 to 2015. The process of base change has enabled a series of improvements to be introduced in the indicator that go beyond merely recalculating the weighting coefficients and the readaptation of the sampling panel. Among the most relevant aspects of the base change process are:

• The updating of weighting coefficients, including a more updated sectorial structure. The weighting coefficients have been calculated from data from the Construction Accounts of the Autonomous Community of Euskadi for 2015.
• The renewal of the reporting units panel has been carried out with the aim of increasing the representativeness of the index, with the incorporation of new reporting units. The new sample panel of the index consists of a total of 515 industrial companies that report monthly sales prices of their products.
• The new method of calculating the index plans to incorporate companies' acquisitions and casualties on an ongoing basis, which will allow the representativeness of the sample to be adequately maintained.
• The calculation of the index and the presentation of results is carried out in accordance with the national classification of economic activities-CNAE 2009.
• A total of 14 branches taken from sector classification A64 are considered, according to CNAE-09.

The new series based on 2015 have been linked to the previous series based on 2010, so that analysts and users can carry out, without any rupture, the monitoring of monthly estimates of the index since January 1995 in the Database.