What are the best statistics in an era of big data?
Economists, business executives and investors confront a barrage of economic statistics every day—much of it conflicting. Government agencies such as the Bureau of Economic Analysis issue indicators designed to gauge the U.S. economy, the world's largest. Yet the nation's shift from a manufacturing economy to one based on information and services has called into question whether traditional measurements developed in the post-World War II era reflect economic reality. Critics say no, and they are using a host of new tools based on “real time” data—from Internet searches to satellite imagery to photographic analysis—to try to answer the fundamental question of how the economy is doing. But others say this new approach is imprecise and cannot replace traditional surveys. Among the questions under debate: Do traditional indicators really reflect the U.S. economy? Will using new sources of data improve economic forecasting and measurement? Do traditional economic indicators such as GDP reflect reality in the developing world?
Baumohl, Bernard, “The Secrets of Economic Indicators: Hidden Clues to Future Economic Trends and Investment Opportunities,” 3rd ed., FT Press, 2012. The chief global economist at The Economic Outlook Group, who is also a former economics reporter for Time magazine, offers an engaging assessment of economic measures, updating the latest edition of his best-selling book to include lessons from the 2007–09 recession.
Coyle, Diane, “GDP: A Brief but Affectionate History,” Princeton University Press, 2014. An economist and former adviser to the U.K. treasury department traces the history of GDP as an economic-growth standard and concludes the metric is increasingly inappropriate for evaluating 21st-century economies supported by innovation, services and intangible goods.
Litan, Robert, “Trillion Dollar Economists: How Economists and Their Ideas have Transformed Business,” John Wiley & Sons, 2014. The director of economic research at organizations that have included the Brookings Institution, Kauffman Foundation and Bloomberg Government details the influence economists have had—and are having—in the business world.
Dube, Ryan, “Argentina's Macri Tackles Flawed Government Data as Part of Overhaul,” The Wall Street Journal, Dec. 27, 2015, http://tinyurl.com/
Ito, Aki, and Alisa Odenheimer, “Your 119 Billion Google Searches Now a Central Bank Tool,” Bloomberg Business, Aug. 1, 2012, http://tinyurl.com/
Kearns, Jeff, “Satellite Images Show Economies Growing and Shrinking in Real Time,” Bloomberg Business, July 8, 2015, http://tinyurl.com/
Kelsh, Chaz, “Household surveys: Problems, usefulness in collecting data,” Journalist's Resource, Harvard Kennedy School, Shorenstein Center on Media, Politics and Public Policy, Jan. 5, 2016, http://tinyurl.com/
Levin, Jonathan, “Economics in the Age of Big Data,” Technology/Academics/Policy, April 21, 2014, http://tinyurl.com/
Marcuss, Rosemary D., and Richard E. Kane, “U.S. National Income and Product Statistics; Born of the Great Depression and World War II,” Survey of Current Business, Bureau of Economic Analysis, February 2007, http://tinyurl.com/
Somoza, Lela, “Part Chart, Part Science: The Evolution of Economic Indicators,” EconSouth, Federal Reserve Bank of Atlanta, Third Quarter 2012, http://tinyurl.com/
Reports and Studies
Choi, Hyunyoung, and Hal Varian, “Predicting the Present with Google Trends,” Google Inc., April 10, 2009, http://tinyurl.com/
Koch-Weser, Iacob N., “The Reliability of China's Economic Data: An Analysis of National Output,” U.S.-China Economic and Security Review Commission Staff Research Project, Jan. 28, 2013, http://tinyurl.com/
Stone, Chad, et al., “A Guide to Statistics on Historical Trends in Income Inequality,” Center on Budget and Policy Priorities, Oct. 26, 2015, http://tinyurl.com/
Suhoy, Tanya, “Query Indices and a 2008 Downturn: Israeli Data,” Research Department, Bank of Israel, July 2009, http://tinyurl.com/
Wu, Lynn, and Erik Brynjolfsson, “The Future of Prediction: How Google Searches Foreshadow Housing Prices and Sales,” Aug. 30, 2013, available at SSRN, http://tinyurl.com/
The Next Step
Torres, Craig, “What You Tweet Might Tell Janet Yellen It's Time to Raise Rates,” Bloomberg Business, March 13, 2015, http://tinyurl.com/
Zumbrun, Josh, “The Billion Prices Project Thinks Inflation May Have Turned a Sharp Corner,” The Wall Street Journal, March 13, 2015, http://tinyurl.com/
Casselman, Ben, “Big Government Is Getting In The Way Of Big Data,” FiveThirtyEight, March 9, 2015, http://tinyurl.com/
Pisani, Bob, “A better way to do economic forecasting?” CNBC, Oct. 14, 2015, http://tinyurl.com/
“A mean feat,” The Economist, Jan. 9, 2016, http://tinyurl.com/
McKenna, Barrie, “The trouble with economic forecasts? Getting it right,” The Globe and Mail [Canada], June 21, 2015, http://tinyurl.com/
Saler, Tom, “Economic turbulence could prove to be dangerous,” The Milwaukee Journal Sentinel, Feb. 13, 2016, http://tinyurl.com/
Dasgupta, Saibal, “Probe Targeting China's Statistic Head Sparks Concern,” Voice of America, Feb. 11, 2016, http://tinyurl.com/
Oyedele, Akin, “REVEALED: The best indicator of the US economy,” Business Insider, July 13, 2015, http://tinyurl.com/
Ujikane, Keiko, and Kyoko Shimodoi, “Dodgy Data That Plagued Japan in War Still Worries Policy Makers,” Bloomberg Business, Jan. 7, 2016, http://tinyurl.com/
American Economic Association
2014 Broadway, Suite 305, Nashville, TN 37203
Academic and professional association and publisher of economic journals, with more than 18,000 members drawn from academia, business and government.
American Institute for Economic Research
PO Box 1000, Great Barrington, MA 01230-1000
Nonpartisan, independent economic research organization.
Billion Prices Project and PriceStats
1 Broadway St., 14th Floor, Cambridge, MA 02142
Founded by two MIT professors, the Billion Prices Project collects price information from hundreds of online retailers to produce alternative price indexes for numerous countries; related company PriceStats measures inflation in 22 economies.
Bureau of Economic Analysis
1441 L St., N.W., Washington, DC 20230
Part of the Department of Commerce that produces national, regional, industry and international data, including closely watched gross domestic product (GDP) estimates.
Bureau of Labor Statistics
Postal Square Building, 2 Massachusetts Ave., N.E., Washington, DC 20212
Part of the Department of Labor that measures labor market activity, working conditions and price changes.
4600 Silver Hill Road, Washington, DC 20233
Conducts economic census and produces data on 14 economic indicators; the Current Population Survey, produced jointly with Bureau of Labor Statistics, is the primary source of labor force statistics.
The Conference Board
845 Third Ave., New York, NY 10022-6600
Global, independent business membership and research association, founded in 1916; publishes the Consumer Confidence Index, Leading Economic Indicators and other key data for the United States and other countries.
20th Street and Constitution Avenue, N.W., Washington, D.C. 20551
U.S. central bank, made up of the Federal Reserve Board of Governors and 12 regional banks; produces economic data focusing on monetary elements, including debt, wealth and savings.
Institute for Supply Management
2055 E. Centennial Circle, Tempe, AZ 85284-1802
Group of supply managers that publishes the ISM Manufacturing Report on Business (since 1931) and ISM Non-Manufacturing Report on Business (since 1998).
International Monetary Fund
700 19th St., N.W., Washington, DC 20431
Organization of 188 nations that works to ensure stability of the international monetary system; conducts global economic research.
National Association for Business Economics
1920 L St., N.W., Suite 300, Washington DC 20036
Professional association for business economists; membership includes economists in business, academia and government.
Organisation for Economic Co-operation and Development
2, rue André Pascal, 75775 Paris Cedex 16, France
Group of 34 of the world's wealthy nations that promotes policies to improve economic and social well-being; produces data on social as well as economic measures.
United Nations Working Group on Big Data for Official Statistics
United Nations Statistics Division, United Nations, New York, NY 10017
U.N. group from national statistical agencies and organizations that studies how to incorporate “big data” into official statistics.
World Bank Group
1818 H St., N.W., Washington, DC 20433
Multinational organization that lends to developing countries; produces data and research about development.