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CS Monitor: stats are only good when they suit us

by nicta Thu Mar 15th, 2007 at 11:34:37 AM EST

Statistics can mislead as easily as they can enlighten

French workers are indeed more productive than their American counterparts, but what about all those unemployed French?

My response to them:

In the article "Statistics can mislead as easily as they can enlighten", D. J. Boudreaux asks: "French workers are indeed more productive than their American counterparts, but what about all those unemployed French?"

If I was merely interested in stating the obvious, I could simply ask back: "and what about those 1.5% of working age Americans who are in prison?"

But Mr. Boudreaux is an economist, he's interested in statistics, and he might find this one interesting: "For the fourth quarter of 2004, according to OECD, (source Employment Outlook 2005 ISBN 92-64-01045-9), normalized unemployment for men aged 25 to 54 was 4.6% in the USA and 7.4% in France. At the same time and for the same population the employment rate (number of workers divided by population) was 86.3% in the USA and 86.7% in France."

(From http://en.wikipedia.org/wiki/Unemployement, quoting http://www.oecd.org/dataoecd/36/30/35024561.pdf)

Unemployment rates are easily distorted. Generous unemployment benefits mean that French citizens will religiously register their status every month with the relevant agencies; while the lack thereof means that it's a waste of time to do so for someone in the United States.

There are also countless deliberate schemes in different countries: some choose for instance to classify long-term unemployed people as disabled, thereby artificially removing them from the count; others count anyone over 50 and unemployed as retired.

Beyond the hard numbers, some realities are worth keeping in mind: even if losing your job is still an unpleasant experience in France, you won't have to worry about losing your health insurance. You won't be thrown in jail for life because you blew your "third strike" on petty theft to feed your family. Your car won't be "repo'd"; on the other hand, you don't have the "freedom" to easily rack up insane amounts of credit to buy an utterly useless SUV.

Those are two different models for a modern society at work. One where the government is not trusted and does not do much indeed to protect its citizen. And another where the government is expected to provide for its constituents, and is strongly reminded of its duties when it fails to do so.

I suspect the American model is losing credibility, which is probably why its supporters have to make such stuff up to dissuade the American people out of asking more of their government.

Not only the 1.5% in prison - what about every lowly employee in that vast industry called the Pentagon. Many join as recruits precisely because otherwise there was no hope for them where they were.

I don't know the figures, but I expect ordinary military personnel could take a half a point off the unemployed figure.

You can't be me, I'm taken

by Sven Triloqvist on Thu Mar 15th, 2007 at 11:52:21 AM EST
The basic point is that comparing unemployment statistics across economic regions with different structures makes no sense at all.
by Colman (colman at eurotrib.com) on Thu Mar 15th, 2007 at 11:54:09 AM EST
[ Parent ]
Yes. I followed that earlier diary. I agree.

You can't be me, I'm taken
by Sven Triloqvist on Thu Mar 15th, 2007 at 11:59:57 AM EST
[ Parent ]
An effective way of cutting the unemployment rate in a country is to forbid people on unemployment benefit from looking for a job more than once a month. They won't show up in the household survey as unemployed half the time then ...
by Colman (colman at eurotrib.com) on Thu Mar 15th, 2007 at 12:05:02 PM EST
[ Parent ]
From paranoia level bordeaux, I would have to be shown French sources that confirm that everytime a US soldier is moved from one base to another, or redeployed to the ME, it is not counted as a new job created.

Our knowledge has surpassed our wisdom. -Charu Saxena.
by metavision on Thu Mar 15th, 2007 at 06:51:40 PM EST
[ Parent ]
Wasn't there another thread recently about how statistics are only valid when they show the US ahead, or something? Was it from the FT?

"It's the statue, man, The Statue."
by Migeru (migeru at eurotrib dot com) on Thu Mar 15th, 2007 at 12:07:16 PM EST
Statistics aren't everything

In the long run, we're all dead. John Maynard Keynes
by Jerome a Paris (etg@eurotrib.com) on Fri Mar 16th, 2007 at 08:53:43 AM EST
[ Parent ]
A detail: the OECD (ILS) unemployment rate is calculated by carrying out a survey and asking people whether they've not got a job and have looked for one in the last fortnight, not on benefit recipients. Common fallacy, but it damages your credibility.
by Colman (colman at eurotrib.com) on Thu Mar 15th, 2007 at 12:09:05 PM EST
Thanks for your first diary, nicta!

nicta... nicta what?

by afew (afew(a in a circle)eurotrib_dot_com) on Thu Mar 15th, 2007 at 03:54:46 PM EST
Klatu verata?

Peak oil is not an energy crisis. It is a liquid fuel crisis.
by Starvid on Thu Mar 15th, 2007 at 05:18:15 PM EST
[ Parent ]
Is statistics there to be distorted?

People know more ways to distort statistics than to consult it. There is larger market for distortions, it appears.

by das monde on Fri Mar 16th, 2007 at 06:48:48 AM EST
by Laurent GUERBY on Fri Mar 16th, 2007 at 07:05:49 AM EST

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