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Statistical Methods in Economics
Notes
2 LOVELY PROFESSIONAL UNIVERSITY
Definition
The definition of Statistics can be divided into the following two heads:
(A) In Plural Sense,
(B) In Singular Sense.
(A) In Plural Sense: The following are the definitions of Statistics in Plural Sense:
According to H. Secrist—”By Statistics we mean aggregate of facts affected to a marked extent by multiplicity
of causes, numerically expressed, enumerated or estimated according to a reasonable standards of accuracy,
collected in a systematic manner for a predetermined purpose and placed in relation to each other.”
In the words of L. R. Connor—”Statistics are measurements, enumeration or estimater of natural or
social phenomena systematically arranged so as to exhibit their interrelations.”
According to Yule & Kendall—”By Statistics we mean quantitative data affected to a marked extent
by multiplicity of causes.”
In the opinion of A. L. Bowley—”Statistics are numerical statement of facts in any department of
enquiry placed in relation to each other.”
According to Webster—”Classified facts, representing the condition of the people in a State, specially
those facts which can be stated in numbers or in tables of numbers or in any tabular or classified
arrangement.”
On the basis of the above definitions the following characteristics are there in Statistics:
1. Statistics are aggregate of facts: Single and unconnected figures are not Statistics.
A single age of 22 years or 37 years is not Statistics but a series relating to the ages of a
group of people would be called Statistics. Likewise single figure relating to birth, death,
sale, etc. cannot be called Statistics but aggregates of such figures would be Statistics
because they can be studied in relation to each other and are capable of comparison.
2. Statistics are affected to a marked extent by multiplicity of causes: Usually facts and
figures are affected, to a considerable extent, by a number of factors operating together.
For example —Statistics of prices are affected by conditions of demand, supply, imports,
exports, currency circulation, etc. and various other factors.
3. Statistics are numerically expressed: Qualitative expression like good, bad, young, old
etc. do not form a part of statisical study unless numerical equivalent is assigned to such
expression. If it is said that the production of rice per acre in 1997 was 30 quintals and in
the year 2002 it was 50 quintals, we shall be making Statistical statements.
4. Statistics are enumerated according to reasonable standard of accuracy: Facts and figures
relating to any subject can be derived in two way, example—by actual counting and
measurement or by estimates. Estimates cannot be as accurate and precise as actual
measurements. For example—If the heights of a group of people are being measured, it is
right if the measurements are correct to a centimetre but if are measuring the distance
from Agra to Gwalior, a difference of a few kilometres even, can be easily ignored.
5. Collected in a systematic manner: If Statistics are collected in a haphazard manner, it
might fail to give the accurate result. It is, therefore, essential that statistics must be collected
in a systematic manner so that they may Conform to reasonable standard of accuracy.
6. Collected for a pre-determined purpose: Statistical data are collected and processed for
a definite and pre-determined purpose. In general, no data are collected without a pre-
determine purpose.
7. Placed in relation to each other: The Statistics should be comparable. If they are not
comparable, they lose part of their value and thus the efforts in collecting them may not
prove to be as useful as the requirements may be. It is necessary that the figures which are
collected should be a homogeneous so as to make them comparable and more useful.
On the basis of the above description it may be said that numerical data cannot be called
Statistics hence “All Statistics are numerical statements of facts but all numerical statements
of facts may not essentially be Statistics.”
(B) In Singular Sense: The following are the definitions of Statistics in Singular Sense. Lovitt defines
the science as, “That which deals with the collection, classification and tabulation of numerical facts as
the basis for explanation, description and comparison of phenomena.”