THIRD JOINT EUROPEAN COMMISSION OECD WORKSHOP ON INTERNATIONAL

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• THIRD JOINT EUROPEAN COMMISSION OECD WORKSHOP
  ON INTERNATIONAL
• DEVELOPMENT OF BUSINESS AND CONSUMER TENDENCY
  SURVEYS
• BRUSSELS
• 12 13 NOVEMBER 2007
• Results of first coordinated international survey
  on what people know about key statistical
  indicators produced by official statistics
• by Marco Malgarini
• ISAE - Institute for Studies and Economic
  Analyses

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The OECD Global Project on Measuring and
Fostering the progress of Societies

• In June 2007, an exceptional group of 1200
  people from about 130 countries gathered in
  Istanbul to attend the second OECD World Forum on
  "Statistics, Knowledge and Policy
• At the end of the Forum, the OECD, the European
  Commission, the Organisation of the Islamic
  Conference, the United Nations, the UN
  Development Programme and the World Bank released
  the Istanbul declaration, affirming their
  willingness to
• Foster a global conversation about what progress
  actually means
• Galvanise people and institutions to action
• Improve the effectiveness of indicator work and
  their use for policy making
• Make a key contribution to the international
  discussion

THIRD JOINT EUROPEAN COMMISSION OECD WORKSHOP
ON INTERNATIONAL DEVELOPMENT OF BUSINESS AND
CONSUMER TENDENCY SURVEYS BRUSSELS 12 13
NOVEMBER 2007
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The OECD Global Project on Measuring and
Fostering the progress of Societies

• The time frame to achieve this goals is
  2007-2015
• In this period, the Global Project will carry
  out activities in the following areas
• Statistical research on the measurement of
  societal progress in all its dimensions, in
  particular
• Publish comparative results based on an
  international survey on what citizens know about
  the progress of their society
• Design, develop and promote the use of
  innovative ICT tools to facilitate the
  transformation of statistics into knowledge
• Establish a global network to foster the
  measurement of progress in each and every country
  
• Develop a global infrastructure to facilitate
  the assessment of societal progress at national
  and global levels to bring about evidence-based
  policy discussions and decision-making

THIRD JOINT EUROPEAN COMMISSION OECD WORKSHOP
ON INTERNATIONAL DEVELOPMENT OF BUSINESS AND
CONSUMER TENDENCY SURVEYS BRUSSELS 12 13
NOVEMBER 2007
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First results of International surveys on what
people know the Eurobarometer Survey

• In the framework of the standard Eurobarometer
  survey in April-May 2007 a number of questions
  have been added regarding
• the knowledge of key statistical indicators
• The necessity to know this information
• Whether political decisions are made on the
  basis of them.
• The general level of trust the public has in
  official statistical data.
• First evidence suggests that
• A large majority of people do not know about
  official data on GDP and Unemployment
• People tend to affirm that they know about
  inflation, even if the share of wrong answer
  exceeds 50 in all countries
• The percentage of people not knowing official
  figures ranges from more than 85 of people in
  Romania concerning the unemployment rate, to less
  than 10 in Greece for inflation.

THIRD JOINT EUROPEAN COMMISSION OECD WORKSHOP
ON INTERNATIONAL DEVELOPMENT OF BUSINESS AND
CONSUMER TENDENCY SURVEYS BRUSSELS 12 13
NOVEMBER 2007
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First results of International surveys on what
people know GDP growth
THIRD JOINT EUROPEAN COMMISSION OECD WORKSHOP
ON INTERNATIONAL DEVELOPMENT OF BUSINESS AND
CONSUMER TENDENCY SURVEYS BRUSSELS 12 13
NOVEMBER 2007
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First results of International surveys on what
people know inflation
THIRD JOINT EUROPEAN COMMISSION OECD WORKSHOP
ON INTERNATIONAL DEVELOPMENT OF BUSINESS AND
CONSUMER TENDENCY SURVEYS BRUSSELS 12 13
NOVEMBER 2007
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First results of International surveys on what
people know trust in official statistics and
political decisions
THIRD JOINT EUROPEAN COMMISSION OECD WORKSHOP
ON INTERNATIONAL DEVELOPMENT OF BUSINESS AND
CONSUMER TENDENCY SURVEYS BRUSSELS 12 13
NOVEMBER 2007
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The survey on Statistical Knowledge

• During 2007, a number of questions have been
  added to the usual ISAE monthly survey on Italian
  Consumers
• Questions concerned the statistical knowledge of
  Italian citizens on
• MARCH-APRIL 07 GDP growth, Inflation rate,
  Unemployment rate, Deficit/ GDP ratio
• MARCH APRIL two questions on the importance
  and desire of being informed and on the media
  used to gather relevant information
• MAY-SEPTEMBER 2007 two questions on statistical
  literacy, specific to the knowledge of Inflation
  statistics

THIRD JOINT EUROPEAN COMMISSION OECD WORKSHOP
ON INTERNATIONAL DEVELOPMENT OF BUSINESS AND
CONSUMER TENDENCY SURVEYS BRUSSELS 12 13
NOVEMBER 2007
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The survey on Statistical Knowledge

• LOW Response rates to quantitative questions
• On average, Italian citizens tend to be
  OVEROPTIMISTIC about GDP growth and PESSIMISTIC
  for the remaining variables
• UNCERTANTY among respondents was rather HIGH -
  as indicated by Std. Dev
• The MEDIAN is generally closer to true values
  than the mean, indicating that answers
  distributions are RIGHT- SKEWED

THIRD JOINT EUROPEAN COMMISSION OECD WORKSHOP
ON INTERNATIONAL DEVELOPMENT OF BUSINESS AND
CONSUMER TENDENCY SURVEYS BRUSSELS 12 13
NOVEMBER 2007
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The survey on Statistical Knowledge

• Italian citizens believing that information is
  extremely or very important are only a 33 of
  the population
• More than 15 believe that information is not
  very important or not important at all
• More than 40 of the respondents do not want to
  be more informed about these issues

THIRD JOINT EUROPEAN COMMISSION OECD WORKSHOP
ON INTERNATIONAL DEVELOPMENT OF BUSINESS AND
CONSUMER TENDENCY SURVEYS BRUSSELS 12 13
NOVEMBER 2007
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The survey on Statistical Knowledge

• TELEVISION is the most often cited channel used
  to acquire statistical information
• NEWSPAPERS INTERNET are cited by respectively
  52 and 23 of the respondents
• Opinions shared among friends and relatives
  (cited by 11,2 of respondents) and political and
  civic leaders (7) lag behind the radio (almost
  19) as other relevant sources of statistical
  information

THIRD JOINT EUROPEAN COMMISSION OECD WORKSHOP
ON INTERNATIONAL DEVELOPMENT OF BUSINESS AND
CONSUMER TENDENCY SURVEYS BRUSSELS 12 13
NOVEMBER 2007
12
The survey on Statistical Knowledge
THIRD JOINT EUROPEAN COMMISSION OECD WORKSHOP
ON INTERNATIONAL DEVELOPMENT OF BUSINESS AND
CONSUMER TENDENCY SURVEYS BRUSSELS 12 13
NOVEMBER 2007
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Building a Knowledge Score

• What are the determinants of statistical
  knowledge?
• Method employed
• Construct a Knowledge Score aggregating the
  answers to the 5 five questions included in
  Marchs questionnaire
• Assign a score to each respondent based on the
  accuracy of individual answers to each specific
  knowledge question
• Compute the ABSOLUTE VALUE of the individuals
  errors (i.e. the difference between individual
  answer and official data)
• SORT Individual errors and calculate a RAW
  SCORE for each question
• Compute a PERCENTILE RANK SCORE (PRS)
• AGGREGATE by averaging each PRS and get the
  Knowledge Score

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A Model for Knowledge - CONCEPT

• Model estimation using the Knowledge score as
  dependent variable allowing the residuals to be
  heteroskedastic and use robust methods in the
  OLS estimates
• Ki f (SDi, Di, Si) ui
• Ki knowledge score
• SDi socio-demographic characteristics of the
  respondent
• Di desire of being informed
• Si source used for being informed
• ui unobserved error term, assumed to be
  uncorrelated with the regressors

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A Model for Knowledge - VARIABLES

• Control variables
• GENDER (M/F)
• AGE ( lt30 years, 30- 49, 50-64, and 65)
• ZONE OF RESIDENCE (North West, North East, Center
  and South of Italy)
• EMPLOYMENT STATUS (self-employed, employed,
  unemployed and out of LF)
• LEVEL OF EDUCATION (Primary school, Secondary
  school and University level and higher), and
• INCOME (divided into quartiles).
• Desire to be informed and the channels used to
  acquire information are measured on the basis of
  the answers provided to the survey questions

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OUTCOMES- Socio-demographic factors

• Knowledge is HIGHER
• For men with respect to women
• For people between 30 and 65 years of age
• For better educated people
• For self-employed and inactive people (including
  students) with respect to dependent workers
• It is LOWER for people leaving in the South of
  Italy
• It is NOT INFLUENCED by income

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OUTCOMES- Importance and desire to be informed

• Knowledge is NOT STATISTICALLY SIGNIFICANT for
  people thinking it is VERY important to be
  informed
• Knowledge is NOT SIGNIFICANTLY influenced by the
  desired to be more informed about these subjects

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OUTCOMES- Information Channels

• Knowledge SIGNIFICANTLY HIGHER for
• Italians reading NEWSPAPERS to achieve economic
  information
• Italians using INTERNET
• NO significant EFFECTS of watching television,
  listening to the radio and discussing economic
  issues among friends and relatives or political
  and civic leaders

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Conclusions

• European and Italian consumers have shown a low
  level of knowledge of economic data
• There exist a complex interaction between trust
  in official statistical agencies, opinion on the
  political process and the willingness to be
  informed on economic data
• Knowledge results to be significantly influenced
  by socio demographic characteristics of the
  respondents,
• people attributing lower importance to being
  informed being also those scoring worst results
• people reading newspapers and using the Internet
  show a better knowledge of key economic data
• Is there some irrationality of Italian and
  European consumers?
• Or is it a case of rational inattention
  (Curtin, 2007)?

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Conclusions

• Results stress the importance of developing new
  measurement of societal progress, along the lines
  suggested in the OECD Global Project on Measuring
  and Fostering the progress of societies.
• An important step in this direction may be that
  of extending the survey on statistical knowledge
  at the international level, having the goal of
  measuring
• The public level of trust in official statistics
  the possibility of providing a comparison of the
  level of trust in official statistics with the
  general level of trust in societies may also be
  explored
• The public appraisement on the political process,
  particularly regarding the role statistic
  information plays in shaping political decisions
• The public desire/willingness of being informed
  on statistical issues
• The media used to acquire statistical information
  
• The knowledge of
• statistical data (economic, socio demographic
  data)
• Statistical metadata (goods and services
  comprised in the calculation of inflation
  meaning of the GDP concept)
• Else?