Identifying Asset Bubbles:
The Role of a National Statistical Office
-Global Consultation-
Asset price bubbles are the subject of much debate in economic circles after the 2008 global economic and financial crisis. While there is considerable interest in bubbles, their identification poses a number of challenges for the national statistical offices.
With the objective to find out what role a national statistical office (NSO) should play in identifying asset bubbles, Professor Paul Cheung, Director of the United Nations Statistics Division and a team of experts participated in a session on Identifying Bubbles during the Fifteenth Conference of the Commonwealth Statisticians organized by the Indian Government and held in New Delhi, India from 7 to 10 February 2011.
Papers and presentations on Identifying Bubbles
prepared for the Fifteenth Conference of the Commonwealth Statisticians
Identifying Bubbles: What's a National Statistics Office to do?
Jason Russo, Australian Bureau of Statistics |
Paper 
Presentation |
Can bubbles be identified, and should NSOs try?
Dr. Soon Teck Wong, Singapore Department of Statistics |
Presentation |
Economic Crises and Forecasting: a review of South Africa’s model
Pali Lehohla and D. Morudu, Statistics South Africa |
Paper
Presentation |
Adapting the European Statistical System to meet the Bubbles Challenge
James Whitworth, Eurostat |
Presentation |
Statistical indicators within the National Accounts structure that can reflect price bubbles
Kimberly D. Zieschang, IMF |
Paper
Presentation |
Bubbles and Monetary Policy: A perspective
Abhiman Das and Joice John, Reserve Bank of India |
Presentation |
Predicting Recessions and Slowdowns: A Robust Approach
Pami Dua, University of Delhi |
Presentation |
| Report on the deliberations in the session on Identifying Bubbles |
Paper |
Some common themes emerge from the papers prepared for the Conference:
- A “bubble” can be loosely defined as a sharp rise in the price of an asset beyond what could be justified by economic fundamentals. The price rises may be increasingly underpinned by (excessive) borrowing.
- Most economists believe bubbles cannot be identified ex ante; some even deny their existence.
- It is not the role of a national statistics office (NSO) to identify bubbles.
- Tracking the consequences of a bubble “bursting” requires a complex set of sectoral accounts and balance sheets that identify dissections of flows and financial positions by counterparty sector.
UNSD is of the view that the key role of a NSO is to ensure that the core suite of macroeconomic statistics is compiled in accordance with quality standards that assure that they are fit for purpose. It is appropriate for the NSO to assure the availability of a reasonable quality house price index, though such an index need not necessarily be compiled by the NSO itself. The varying housing circumstances in countries will make it very difficult to compile internationally comparable house price indexes among countries. Extension of the sectoral balance sheets already recognised in the UN System of National Accounts 2008 to identify counterparty relationships would be a major challenge for most NSOs. UNSD suggests that such work be focused in those countries that are systemically important in a global financial sense and emphasis should be placed on the timeliness of such data.
UNSD welcomes views on the above and on the views expressed in the Conference papers themselves.
Outcomes from this global consultation will be summarized in a discussion paper.
Please, send your comments and views to Youlia Antonova (antonova@un.org) or Rob Edwards (edwards6@un.org). |
