More Statistical Hocus Focus in EU, Emerging Asia and Japan?

Have governments been desperate enough to resort to statistical trickery to boost up economic growth or downplay risks? 

Europe’s data management from Wall Street Real Times Economic Blog: (bold mine)

Sometimes, the absence of data is a data point itself.

Take, for example, a paper published Friday on transparency trends in the International Monetary Fund’s surveillance.

The paper — see Table 4 — reveals that the European Union and its member countries deleted sensitive information about their financial sector in more than a quarter of the IMF’s reports on their economies last year.

Emerging Asia also previously engaged in the same data mining activities…

It also shows that emerging Asian countries are more confident about public scrutiny of their exchange-rate policies than they were in 2010, when they deleted sensitive references to their exchange rates in nearly one-fifth of the IMF’s country reports on the region’s emerging market economies.

The fund’s annual reports on member countries’ economic policies—called Article IVs in a reference to the specific IMF bylaw that created them–are a hallmark of the global lending institution’s analysis. The reports are designed to ensure both domestic and international economic stability.

IMF’s justification of statistical data "management"….

Member countries have the right, however, to delete material in the reports they deem too sensitive, delay publishing of reports, and even prevent the IMF from publishing reports altogether. The deletions are to help rid surveillance reports of market-sensitive and potentially market-damaging data and preserve the IMF’s role as a trusted adviser. (See Table 8 for publication lags.)

See, when statistical data doesn’t fit with the political agenda, then data management have been rationalized or justified as “market-sensitive and potentially market-damaging data”. This means hiding, censoring or editing or data mining by governments, similar to the Chinese government experience, so as to purportedly “ensure both domestic and international economic stability”

We achieve “stability” by misrepresenting data? 

The logical relations flows the other way around. Phony or inaccurate data, which most likely underpins politically induced imbalances, motivates more mismanagement by politicians. And despite censorship, a continued buildup of such misallocation of resources will eventually reach a tipping point or a critical mass that will then be vented on the marketplace. Economic reality will expose on such whitewashed data.

And it may not just be about EU, emerging Asia and China.

Has Japan been managing statistical data too?

From another Wall Street Real Times Economic Blog:

In recent months, the government has been proudly trumpeting rises in consumer prices, including energy, as proof of its success in ending deflation. Yet non-believers have said that’s cheating, as the yen’s 11% fall against the dollar this year has naturally pushed up prices of imported energy.

The following quote on statistics attributed to Prussian born Austrian surgeon and amateur musician Theodore Billroth says it best…

Statistics are like women; mirrors of purest virtue and truth, or like whores to use as one pleases.