Scope Of Statistics In Economics

Nature of Statistics

The study of nature of statistics is to find out whether it is a Science or Art. As a science statistics studies numerical data in a systematic manner and as an art, it makes use of the data to solve the problems of real life. Some scholars call it a study of Statistical Methods in preference to Statistics science, because its methods are used in all sciences.

Tippet says, “Statistics is both a science and an art.”It is a science as its methods are basically systematic and have general applications. It is an art as its successful application depends to a considerable degree on the skill and special experience of a statistician.

Subject Matter of Statistics

In order to facilitate its study, subject matter of statistics is divided into two parts namely:

(1) Descriptive Statistics

(2) Inferential Statistics

(I) Descriptive Statistics: As the name suggests, the descriptive statistics merely describe the data and consists of the methods and techniques used in the collection, organisation, presentation se methods can either be graphical or computational. These data can be presented in the form of chart table in order to show trends, proportions, maximum and minimum values, etc. In addition to the organisation of data, descriptive statistics is concerned with the analysis of data so that the data can be easily understood. Measures of central tendency, dispersion, skewness and Kurtosis summarises and describes the univariate data and correlation and regression help in the establishing of the and analysis of data in order to describe the various features and characteristics of such data. The or relationship in bivariate data. In descriptive statistics, nothing can be inferred from the data nor can decision be made or conclusion drawn.

(2) Inferential Statistics: It deals with methods which help in estimating the characteristics of a population or making decisions concerning a population on the basis of the sample results. SampleĀ and population are the two relative terms. A population is treated as a universe and a sample is fraction or segment of the universe. The measured characteristics of the sample are called sample statistics, while the measured characteristics of the population are called population parameters. In inferential statistics, we study two major activities: (i) estimation of unknown parameter of a population on the basis of sample statistics and (i) testing whether the sample data have sufficient evidence to support or reject a hypothesis about the population parameter. To be brief, inferential statistics help the decision maker to draw conclusion about the characteristics of a large population on the basis of sample results.

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