Better Statistics, Better Economic Policies?

Item Type Journal paper

More and more economic transactions leave a "digital
footprint". This trend opens unprecedented opportunities for improving economic statistics and underpins demands to give statistical agencies far-reaching access to private-sector data. We analyze the consequences of better economic statistics in a political-agency framework that includes fundamental uncertainty about the impact of potentially welfare-enhancing reforms. We demonstrate that improvements in economic statistics can inhibit - rather than stimulate - reform attempts. With better statistics, the government is less likely to receive the "benefit of the doubt" if the numbers suggest its past reforms are failing. Reforms therefore come with a higher risk of electoral losses, implying that the government has stronger incentives to preserve the status quo. We identify political environments that are particularly vulnerable to this mechanism and contribute to the debate on private-sector data access.

Authors Binswanger, Johannes & Oechslin, Manuel
Journal or Publication Title European Economic Review
Language English
Subjects economics
political science
HSG Classification contribution to scientific community
HSG Profile Area SEPS - Economic Policy
Refereed Yes
Date 2020
Publisher Elsevier
Number 130
ISSN 0014-2921
Publisher DOI
Depositing User Prof. Dr. Johannes Binswanger
Date Deposited 11 Dec 2020 21:04
Last Modified 11 Dec 2020 21:13


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Binswanger, Johannes & Oechslin, Manuel (2020) Better Statistics, Better Economic Policies? European Economic Review, (130). ISSN 0014-2921

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