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An Examination of the Statistical Discrepancy and Private Investment Expenditure

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Abstract

The statistical discrepancy is often used to gauge the reliability of national accounts data. Particularly since the mid-1980's the statistical discrepancy in Australia has grown significantly in size and variance. In the paper we demonstrate that the overwhelming contribution to the size of the statistical discrepancy is mismeasurement of private investment expenditure. We demonstrate that this mismeasurement not only adds to the volatility of investment but may have a significant impact on the volatility of the business cycle in general.

Suggested Citation

  • Chris Bajada, 2000. "An Examination of the Statistical Discrepancy and Private Investment Expenditure," Working Paper Series 103, Finance Discipline Group, UTS Business School, University of Technology, Sydney.
  • Handle: RePEc:uts:wpaper:103
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    File URL: http://www.finance.uts.edu.au/research/wpapers/wp103.pdf
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    References listed on IDEAS

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    1. Weale, Martin, 1985. "Testing Linear Hypotheses on National Account Data," The Review of Economics and Statistics, MIT Press, vol. 67(4), pages 685-689, November.
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    3. Alan S. Blinder & Louis J. Maccini, 1991. "Taking Stock: A Critical Assessment of Recent Research on Inventories," Journal of Economic Perspectives, American Economic Association, vol. 5(1), pages 73-96, Winter.
    4. McDonald, John, 1972. "An Examination of the Residual Error in the U. K. National Accounts," The Manchester School of Economic & Social Studies, University of Manchester, vol. 40(2), pages 193-207, June.
    5. Weale, Martin, 1992. "Estimation of Data Measured with Error and Subject to Linear Restrictions," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 7(2), pages 167-174, April-Jun.
    6. Warwick J. McKibbin, 2002. "Macroeconomic Policy in Japan," Asian Economic Papers, MIT Press, vol. 1(2), pages 133-165.
    7. Newey, Whitney & West, Kenneth, 2014. "A simple, positive semi-definite, heteroscedasticity and autocorrelation consistent covariance matrix," Applied Econometrics, Publishing House "SINERGIA PRESS", vol. 33(1), pages 125-132.
    8. Guest, Ross S. & McDonald, Ian M., 2001. "The volatility of the socially optimal level of investment," Journal of Policy Modeling, Elsevier, vol. 23(8), pages 901-928, November.
    9. Alan S. Blinder, 1981. "Retail Inventory Behavior and Business Fluctuations," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 12(2), pages 443-520.
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    Keywords

    statistical discrepancy; national accounts; investment; business cycles;

    JEL classification:

    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • C82 - Mathematical and Quantitative Methods - - Data Collection and Data Estimation Methodology; Computer Programs - - - Methodology for Collecting, Estimating, and Organizing Macroeconomic Data; Data Access

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