CHAPTER 1

STATISTICS – SCOPE AND DEVELOPMENT

Study notes

• The word ‘statistics’ have been derived from the Latin word ‘Status’ or the

Italian word ‘Statista’. The meaning of both these words are ‘political state’.

• Sir R A FISHER is known as the father of modern statistics.

Definition of Statistics

The most common definition of Statistics given by Croxton and Cowden is:

“Statistics can be defined as the collection, presentation and

interpretation of numerical data”.

Functions of Statistics

1. Statistics simplifies complexity.

2. Statistics presents facts in a definite and precise form.

3. Statistics provides comparison.

4. Statistics enlarges human knowledge and experience.

5. Statistics helps in formulating policies, testing of hypothesis and

forecasting future events.

Scope and Importance of Statistics

Statistics has scope and importance mainly in the following fields.

• Statistics and Planning

Planning is necessary for solving complexities and uncertainties in all walks

of life. In this age Statistics is an essential tool for planning.

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• Statistics and Economics

Statistics has wide importance in Economics. Statistical data and techniques

have extremely large use in solving a variety of economic problems such as

analysis of time series determination of index numbers etc.

• Statistics and Industry

Statistics is widely used in ‘Quality control’. Statistical tools like control

charts, inspection plans etc are very much used in production engineering to

find whether a product is conforming to specifications or not.

• Statistics and Mathematics

Statistics and Mathematics are very closely related. Most of the statistical

techniques are the outcomes of wide application of advanced mathematics.

• Statistics and Medical Sciences

The statistical tools for the collection, presentation and analysis of observed

facts relating to the causes and incidence of diseases and the results

obtained from the use of various drugs and medicines are of greater

importance in the field of medical sciences. The efficacy of manufactured

drugs, injections and medicines are tested using appropriate statistical

techniques.

• Statistics, Psychology and Education

In education and Psychology, Statistics is widely used in the determination

of reliability and validity of a test, measuring intelligence quotient, factor

analysis etc.

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 • Statistics and Management Studies

Statistical analysis is used in providing information for making decisions in

the field of marketing, production, finance, banking, investment, purchasing

and accounting.

Limitations of Statistics

Even though Statistics has wide applications, it has some limitations. Some of

them are:

1. Statistics has no role in cases where quantification is not possible. Fore

example, Statistics can not be directly used in studying beauty, courage,

intelligence etc. because they can not be quantified.

2. Statistics does not study individual items, but deals with aggregate.

3. Statistics are collected for a particular purpose. The data collected for a

particular purpose may not be relevant or useful in other situations.

4. Statistics are not 100% accurate.

Misuse of Statistics

Statistics has misuses also. The various reasons of misuse are:

(i) Sources of data not given

(ii) Using defective data

(iii) Unrepresentative samples

(iv) Inadequate sample

(v) Unfair comparisons

(vi) Unwanted conclusions

(vii) Inappropriate statistical tools.

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Some Applied Areas of Statistics

Actuarial Science

Actuarial science is the discipline that applies mathematical and

statistical methods to asses risk in the insurance and finance sector. Actuarial science

applies the mathematics of probability and statistics to define, analyse and solve the

financial implications of uncertain future events.

Biostatistics

Biostatistics is the application of statistical methods to the solution of

biological problems. It is also called biometry. The use of statistical methods are

constantly increasing in biological sciences. The development of biological theories are

closely associated with statistical methods. Biostatistics is used in physiology,

anatomy, pharmacology, medicine, community medicine and public health.

Agricultural Statistics

Agricultural statistics is the applications of statistical principles and

methods in agriculture. Because of the variability inherent in agricultural data,

knowledge of statistics is necessary for their understanding and interpretation. The

agricultural investigations are based on the applications of statistical methods and

procedures which are helpful in testing hypotheses using observed data, making

estimation of parameters and in predictions.

Official Statistics

Ministry Of Statistics and Programme Implementation (MOSPI)

MOSPI is an independent ministry under the central government. The current

Minister of MOSPI is Mr. Rao Inderjit Singh. The ministry has two wings – Statistics

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and Programme implementation. The Statistics wing is also called National Statistical

Office (NSO). This wing contains the Central Statistical Office (CSO), the Computer

centre and National Sample Survey Office (NSSO).

The Programme implementation wing contains the following.

• Twenty point programme.

• Infrastructure monitoring and project monitoring.

• MP local area development scheme.

Central Statistical Office (CSO)

CSO is one of the branches of NSO. The CSO is responsible for the co-ordination

of statistical activities in the country and for developing and maintaining the

statistical standards. The activities of CSO are, compilation of National Accounts,

Conduct of annual surveys of Industries and Economic censuses, compilation of Index

of Industrial production as well as consumer price indices. CSO is located in New

Delhi. The industrial statistics wing of CSO is located in Kolkata. The Computer centre

under CSO is at New Delhi.

National Sample Survey Office (NSSO)

NSSO is the largest organisation in India, conducting regular socio-economic

surveys. NSSO has four divisions.

1. Survey Design and Research Division (SDRD)

2. Field Operations Division (FOD)

3. Data Processing Division (DPD)

4. Co-ordination and Publication Division (CPD)

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Indian Statistical Institute (ISI)

Indian Statistical Institute (ISI) is an institution devoted to the research,

teaching and application of Statistics, Natural sciences and Social sciences. ISI was

founded by Prof. P C Mahalanobis. It is situated in Kolkata. Prof. P C Mahalanobis is

known as the father of Indian Statistics. His birth day, June 29 is celebrated as the

National Statistics Day in India. The journal of statistics published by ISI is SANKHYA.

Economics and Statistics Department-Kerala

The Directorate of Economics and Statistics under the Government of Kerala is

the nodal agency of the state responsible for the systematic collection, compilation,

analysis, interpretation and dissemination of statistics relating to various sectors of

Kerala economy. It is the nerve centre of the state statistical system.

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