The quality of data

Abstract

Data cannot possibly be compared with the ‘true data’ in order to assess its quality. Instead, its quality is determined by its precision as well as by the evidence in favor of its underlying assumptions. In general, forecasts are negatively affected by inferior data-quality. Both macroeconomic and climate-data suffer from typical problems of aggregation and their quality, in terms of precision as well as of evidence for underlying assumptions, is poor. Thus, a considerable part of macroeconomic and climate forecast failure can be explained.