Q:

What is the importance of statistics in economics?

A:

Statistics are a methodology necessary in the field of statistics and are used to collect, analyze and evaluate data. Economics depends heavily on the use of statistics.

Economics is defined as the study of how people behave with regard to the production and consumption of goods. As a social science, economics attempts to describe trends in consumer markets, such as wealth acquisition and transfer. There are two forms of economics:

  • Macroeconomics: analysis of large-scale economic activity, such as within a country or international market
  • Microeconomics: analysis of small-scale economic activity, such as between individuals and corporations

There are various themes studied within both forms of economics, including costs, production, consumption, and the rationales behind individual, corporate, national and international trade. In order to develop hypotheses around the various topic areas, economists make use of statistics and are able to compare information. Economic statistics involve quantitative data that describe either past or present trends. The data may be presented in various ways:

  • Time-related: to show trends and changes that occurred across a specific period of time, for example, unemployment rates or housing costs during a 10-year period
  • Cross-section: to show trends and changes within a specific period of time, for example, job statistics for current year college graduates

Economic statistical data sets include information about measurement, sample sizes, collection procedures and analysis processes. The data are often published for public use, such as through the United States Census or for private use, such as intra-company data used for decision-making.

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Related Questions

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    What is variance in statistics?

    A:

    Variance measures how the data in a given variable distribution are spread relative to the mean. Operationally, it is the average squared distance from the mean and is calculated by the square root of the standard deviation. Conceptually, it indicates how much variation is within a given sample.

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  • Q:

    What are the advantages of parametric statistics?

    A:

    Parametric statistics makes it easier to analyze and describe data with central tendencies and data transformations, according to University of Leicester. The use of parametric statistics versus nonparametric statistics depends on the type of data.

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    What are some examples of descriptive statistics?

    A:

    Descriptive statistics are statistics that describe the central tendency of the data, such as mean, median and mode averages. Variance in data, also known as a dispersion of the set of values, is another example of a descriptive statistics. Greater variance occurs when scores are more spread out from the mean. Descriptive statistics summarize data.

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  • Q:

    What the difference between statistics as numerical fact and statistics as a discipline?

    A:

    Statistics as a numerical fact is a piece of numerical information, also known as data, used to describe an event, occurrence or phenomena. Statistics as a discipline uses statistics or numerical pieces of information to solve problems in the everyday world and in academics. Those who work with statistics as a discipline are called statisticians.

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