Quality of Higher Education in Pakistan
SOME PROBLEMS IN THE MEASUREMENT OF REAL NATIONAL INCOME
By J. L. Nicholson
(Chief Statisticion, United Kinrdorn Cer~trol Sfatistical Oflcc)
The Truth is one and incapable of contradiction; All knowledge that conflicts with itself is Poetic Fiction. -W. H. Auden.
I. THE GENERAL SElTING
BEFORE discussing problems of method, one ought to be clear about aims. One is hardly in a position to taclcle the numerous and various problems that are peculiar to the measurement of real national income until one knows the purposes for which the results are intended to be used. This is the kind of proposition with which few people would disagree but which, as Oscar Wilde said about someone's face, once seen never remembered. Since estimates of real national income may have several possible objects, one should not expect to find perfectly general solutions to many of the problems. The correct, or most appropriate, solution for one purpose may often differ from the correct, or most appropriate, solution for some other purpose. There would be general agreement that the particular purpose of the estimates may affect the choice of weights, as well as the definition of what is included within the boundaries of economic activity. But it may also influence the best method of making use of the available data; and one should even bear in mind the possibility that, in certain cases, it may affect the choice of indicators. The purposes of estimates of the real national income or product seem to fall into two main categories. Such estimates may be needed in connection with (a) problenls concerned with the potential or actual welfare or satisfaction derived by consumers and purchasers of final products; or (b) problems of productivity, and the effective utilization of resources, the emphasis in this case being on the producer, not the consumer. It must be admitted that the usefulness of estimates of the
145
146
I N C O M E A N D WEALTH
real natiollal income, in either
By J. L. Nicholson
(Chief Statisticion, United Kinrdorn Cer~trol Sfatistical Oflcc)
The Truth is one and incapable of contradiction; All knowledge that conflicts with itself is Poetic Fiction. -W. H. Auden.
I. THE GENERAL SElTING
BEFORE discussing problems of method, one ought to be clear about aims. One is hardly in a position to taclcle the numerous and various problems that are peculiar to the measurement of real national income until one knows the purposes for which the results are intended to be used. This is the kind of proposition with which few people would disagree but which, as Oscar Wilde said about someone's face, once seen never remembered. Since estimates of real national income may have several possible objects, one should not expect to find perfectly general solutions to many of the problems. The correct, or most appropriate, solution for one purpose may often differ from the correct, or most appropriate, solution for some other purpose. There would be general agreement that the particular purpose of the estimates may affect the choice of weights, as well as the definition of what is included within the boundaries of economic activity. But it may also influence the best method of making use of the available data; and one should even bear in mind the possibility that, in certain cases, it may affect the choice of indicators. The purposes of estimates of the real national income or product seem to fall into two main categories. Such estimates may be needed in connection with (a) problenls concerned with the potential or actual welfare or satisfaction derived by consumers and purchasers of final products; or (b) problems of productivity, and the effective utilization of resources, the emphasis in this case being on the producer, not the consumer. It must be admitted that the usefulness of estimates of the
145
146
I N C O M E A N D WEALTH
real natiollal income, in either