MEASUREMENT PROBLEMS IN THE CHANGING PATTERN OF INTERNATIONAL TRANSACTIONS, WITH PARTICULAR REFERENCE TO CANADIAN EXPERIENCE

Abstract

The unsolved problems of measurement of international transactions may have consequences which are serious both for policymakers and for those undertaking research. Emphasis is placed on the need for users of data to understand and take into account the limitations and qualifications attached to them. The causes of deterioration in the quality of estimates of international transactions likely lie in their changing pattern. After a brief discussion of the basic sources and methods used, the paper selects for comment possible measurement problems related to inflation, taxation, illegal transactions, and affluence. A description follows of the improvement to data which has been achieved through exchanges and comparisons between trading partner countries. Efforts to use econometric analysis to point to error sources have, however, proved less rewarding. The paper concludes with a section on the linkage of flow and stock estimates.