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On Misusing National Accounts Data for Governance Purposes

Author

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  • Jochen Hartwig
Abstract
According to KENDRICK (1996, p. 1), National Accounts have become "an indispensable tool for macroeconomic analysis, projections, and policy formulation" . The paper elaborates on this statement, addressing policy domains that rely heavily on National Accounts data. Yet - useful as they are - National Accounts can also be misused in the context of governance. The most common misapplication of National Accounts relates to the field of international comparisons. For instance, according to National Accounts data, the U.S. have outperformed all other high-income economies over the course of the 90s and up through the new millennium. In many European countries, public debate centres on the question how to devise 'structural reforms' in order to make the set-up of the respective economy more similar to that of the United States. Arguably, the main impact of National Accounts on governance can be found here. Still, there are large differences in the ways National Accounts calculations are carried out even among European countries, let alone between Europe and the U.S. The paper discusses several such differences, showing that the divergence in growth rates between the U.S. and the EU since 1997 can be explained almost entirely in terms of differing statistical methods.

Suggested Citation

  • Jochen Hartwig, 2005. "On Misusing National Accounts Data for Governance Purposes," KOF Working papers 05-101, KOF Swiss Economic Institute, ETH Zurich.
    • Handle: RePEc:kof:wpskof:05-101
    DOI: 10.3929/ethz-a-004957458
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    References listed on IDEAS

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    1. Jochen Hartwig, 2005. "Messprobleme bei der Ermittlung des Wachstums der Arbeitsproduktivität - dargestellt anhand eines Vergleichs der Schweiz mit den USA," KOF Working papers 05-100, KOF Swiss Economic Institute, ETH Zurich.
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    Cited by:

    1. AfDB AfDB, . "Strategy for the Harmonization of Statistics in Africa," Global Strategy Implementation Bulletin, African Development Bank, number 370.
    2. Jochen Hartwig, 2005. "Sind unsere gesamtwirtschaftlichen Probleme ueberhaupt loesbar?," KOF Working papers 05-112, KOF Swiss Economic Institute, ETH Zurich.

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    Keywords

    National Accounts; Governance; Inflation and growth comparisons; Deflation methods; Statistical artefacts;
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