In retail inflation, data comparability is the key
The pandemic may structurally change the way data is collected for official statistics.
The government is examining options, including the use of mobile applications for reporting price data to compute retail inflation.
Through an application-based system, shopkeepers will be able to update price information in a format every month, partly doing away with the need for visits by field investigators.
The objective is to ensure sustained data quality and collection amid a lockdown or a pandemic-type of situation in the future as well.
With closed shops and markets, field officers worked remotely and collected information on the telephone in April for the consumer price index, raising concern on data accuracy.
Chief Statistician Pravin Srivastava said alternative methods of data collection such as telephone or mobile applications would need to be institutionalised.
“We used the telephonic way of price reporting, but in an informal manner, in April. We will start working to institutionalise alternative data collection,” he said.
Despite a telephone- or app-based system, one may need to follow it up with the shopkeepers to upload correct data.
Monthly price data is collected from 1,114 markets in 310 select towns by the field operations division of the statistics
ministry and the specified state/union territories’ directorates of economics and statistics.
Apart from this, the department of posts collects data from 1,181 select villages.
As for challenges related to the telephonic method, Srivastava said it was possible that a shopkeeper might not respond during the peak time and hence correct information might not be available.
The National Statistical Office is exchanging ideas with international agencies about handling data and statistics amid the pandemic situation.
Pronab Sen, former chief statistician, who is heading a committee to improve data quality, said telephonic- or app-based collection would become a norm.
“An application-based data collection will work as you can pick up specific shops or data outlets and give price data in a standard format. But the problem will arise if there is confusion about the product itself,” he said.
On retail inflation, data comparability is the key. If the category is basmati rice, you need to gather price for only the specific quality of it; if it is 100 gm of Colgate, the data input cannot be for 100 gm of Pepsodent, Sen said.
The telephonic system may be problematic because shopkeepers may be wary of providing data if they do not know the field officers.
“They may think the data may be used by their competitor, and that will affect their response. So initially, it will be important to build contacts with the data source,” Sen said.
Alternative sources of data will need to be looked at to see whether the data is in the same range or not. It may be by way of looking at administrative data related to the National Rural Employment Guarantee Act (NREGA) or as part of the monitoring exercise of ministries.
Sample surveys will be an issue, with telephonic reporting not possible in that.
“There are going to be data gaps throughout the world. The problem is not unique to India. This is a global problem and we are in touch with all the international agencies to evolve the way and how we can address it,” Srivastava said.