Duplication in cost of materials and value of shipments

{
  "id": "MLC-T-ECS-000551",
  "term": "Duplication in cost of materials and value of shipments",
  "field": "Economic statistics",
  "definition": "The aggregate of the cost of materials and value of shipments figures for industry groups and for all manufacturing industries includes large amounts of duplication, since the products of some industries are used as materials by others. This duplication results, in part, from the addition of related industries representing successive stages in the production of a finished manufactured product. Examples are the addition of flour mills to bakeries in the food group and the addition of pulp mills to the paper manufacturing group of industries. Estimates of the overall extent of this duplication indicate that the value of manufactured products exclusive of such duplication (the value of finished manufactures) tends to approximate twothirds of the total value of products reported in the annual survey. Duplication of products within individual industries is significant within a number of industry groups, e.g., machinery and transportation industries. These industries frequently include complete machinery and their parts. In this case, the parts made for original equipment are materials consumed for assembly plants in the same industry. Even when no significant amount of duplication is involved, value of shipments figures are deficient as measures of the relative economic importance of individual manufacturing industries or geographic areas because of the wide variation in ratio of materials, labor, and other processing costs of value of shipments, both among industries and within the same industry.",
  "references": [
    "U.S. Census Bureau Glossary"
  ],
  "url": "https://mlchart.com/terminology/economic-statistics/duplication-in-cost-of-materials-and-value-of-shipments/"
}