Statistics Corner: Issues for Official Statistical Systems in Democratic Market Societies

By Franchet, Yves | Business Economics, July 1991 | Go to article overview
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Statistics Corner: Issues for Official Statistical Systems in Democratic Market Societies


Franchet, Yves, Business Economics


Note: The Common Market countries have agreed to provide technical assistance to the Eastern and Central European countries, which are facing the challenge of transition from a planned economy to a market-based economy. In order to make this transition, it is important both to improve existing statistics and to create new systems that will meet the needs of the transition. A maJor leadership role in these statistical activities is provided by Eurostat. Hence, it is especially important to consider the views of Yves Franchet, the Director General of Eurostat, as he addresses issues of official statistical systems in this guest article. - Joseph Duncan, Editor, The Statistics Corner.

AT THE END of the twentieth century, official statistics played a very important role in most democratic market societies. In these complex societies, very few people challenged the idea that governing cannot be done without accurate, timely, and relevant statistics. Information in general is now nearly as important to the decision making and production processes as labor and capital. And statistical information is a significant part of this information. Very few people challenge the idea that public institutions have to play a leading role in the collection and dissemination of statistics.

In a market economy, the actors of the market - citizens, business, government - need statistics to reduce uncertainty at times of decision. Governments in particular need statistics to formulate, monitor and evaluate the policies they implement in order to ensure that market mechanisms function properly. Governments also need statistics to take steps to protect the weaker segments of the population: the poor, the handicapped, the aged. Citizens and the general public need statistics about the conditions inside and outside their country, so that they can effectively participate in the democratic process.

On the other hand, the experience accumulated so far worldwide proves that the market mechanism fails in the production of the general information that is contained in official statistics. Official statistics are a basic infrastructure of market economies, costly and time consuming to produce, and private sectors of the market are not willing to invest enough time and money to build and maintain this infrastructure.

ROLE AND CHARACTERISTICS OF OFFICIAL STATISTICS

The role of official statistics can be summarized as supplying the quantitative information needed for a proper functioning of the democratic political process and of the market.

In an article written for the Journal of Official Statistics, the Director General of Statistics Sweden, Sten Johansson, syntheses the information system needed to serve the democratic political process into three basic elements:

1. Institutions based on freedom of opinion, and that insure the unrestricted and open forming of public opinion (media and various types of organizations);

2. Independent science, where scientists have the freedom to think and produce ideas independently in their domain, and submit their results to public debate;

3. An independent counting authority, which can serve as a basis of reference for all actors in the functioning of democracy. This authority produces official statistics, which have to be available not only to the government, but also to citizens.

The first paragraph of the Law on Federal Statistics of the Federal Republic of Germany reads as follows:

"Statistics for federal purposes (federal statistics) are designed, in the federal overall structure of official statistics, to provide, process, represent and analyze data on mass phenomena on a regular basis. They are covered by the principles of neutrality, objectivity and scientific independence. Data are obtained through the application Of scientific knowledge and the appropriate methodology and information techniques. The results of federal statistics throw light on social, economic and ecological relationships for the whole federation, the Lander, and towns, society, science and research.

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