Rest of World Adjustment

The rest-of-the-world adjustment to final uses consists of values for exports and imports that have offsetting adjustments to personal consumption expenditures (PCE) and government. This adjustment is required in order to conform the commodity treatment of the I-O use table to the expenditure concepts used for final uses in the NIPAs. This is accomplished by making offsetting adjustments between PCE and gross exports and between Federal Government nondefense purchases and exports and imports. For example, foreigners traveling in the United States consume goods and services, such as accommodations, that are included in the source data for PCE. In order to put the PCE estimate on a NIPA basis, an adjustment is made to account for these purchases. (BEA)