BUSINESS STATISTICS: A BRIEF HISTORY

INTRODUCTION
In common parlance, the word Statistics is used to mean pieces of
numerical information.
German scholar, Gottfried Achenwall, in the middle of the
18th century introduced the word statistik.
The word statistik comes from the Latin word “Status” or Italian
word “Statistia” or German word “Statistik” or the French word
“Statistique”; meaning a political state or statesman, and originally
meant information useful to the state.

INTRODUCTION
Dr. E. A. W. Zimmerman introduced the word statistics into
England.
The statistics use was popularized by Sir John Sinclair in his
work ‘statistical account of scotland (1791-1799)’.

History of Indian Statistics
Early origins
Dwaparyuga - Mahabharata; Vana Prarva; Nala – Damyanti Akhyan
It is interesting and illuminating to note that statistical knowledge and
probabilistic ideas were attributed to the kings and rulers mentioned
in the great Indian epic, the Mahabharat.

Nala and king Bhangasuri were moving in a chariot through a forest. Bhangasuri
told Nala that if he can count how many fallen leaves and fruits are there, he
(Bhangasuri) can tell the number of fruits and leaves on two strongest branches of
Vibhitak tree. One above one hundred are the number of leaves and one fruit
informed Nala after counting the fallen leaves and fruit. Bhangasuri avers 2095
fruits and five ten million leaves on the two strongest branches of the tree (actually
it is 5 koti leaves and 1 koti is 10 million). Nala counts all night and is duly amazed
by morning. Bhangasuri accepts his due "I of dice possess the science—and in
numbers thus am skilled." said Bhangasuri. Vahuca replied; "That science—if to me
thou wilt impart, In return, O king, receive thou—my surpassing skill in steeds."
This indeed is a strong application of survey sampling.

Early origins
433 - 357 BCE –Bhadrabahu
The concept of probability was recognized in the Indian-Jaina philosophy as is
evident from the writings of Bhadrabahu on syadvada or 'the assertion of
possibilities' (syat = 'may be', vada = 'assertion'). Mahalanobis (1954) and Haldane
(1957) refer to the actual text in Sanskrit of the dialectic of seven fold predication
(Saptabhanginaya) and relate it to the concepts of probability theory with examples
of 'tossing of a coin' and 'study of the physiology of the sense organs'.

Early origins
the Arthasastra by Kautilya (normally attributed to 321-296 B.C.)
The great treatise in Economics, the Arthasastra by Kautilya (normally
attributed to 321-296 B.C.) during the Mauryan period had a detailed
description of the system of data collection relating to the agricultural,
population and economic censuses in villages and towns during the period.

Early origins
Abul Fazal during mugal period - Ain-i-Akbari
Abul Fazal belonged to the court of the great Moghul Emperor Akbar
around 1590 A.D.. This had details of several government departments
including the system of legalized measurements, land classification and crop
yields by season among others.

Early origins
Zawabit-i-Alamgiri or the regulations of the Emperor Aurangzeb
Zawabit-i-Alamgiri or the regulations of the Emperor Aurangzeb which was
prepared in 1690 was a good chronicle of statistics.

Statistical System in British India/ Pre independence period
The foundation of the statistical system in India was laid down by the British
administration.
The Provincial Governments were required to publish the relevant statistics in
their annual administration reports.
Statistics in India thus developed in the Provinces expanding in scope to cover
the fields of agriculture, industries, civil supplies (during the World War II),
education, forestry, labour, cooperation, health and vital statistics.

The first significant development in the pre-independence era was the
constitution of a Statistical Committee (1862) for the preparation of forms
to collect statistical information on different subject areas.
The first complete Population Census was conducted in 1881 on a uniform
basis throughout the country. Since then the census is being conducted
regularly after every ten years.

In 1895, the Statistical Branch was converted into a full-fledged Statistical
Bureau.
In 1905, Functions and activities of the Statistical Bureau were carried out
through two well-defined wings namely, Commercial Intelligence and
Statistics putting both under an organization entitled Department of
Commercial Intelligence and Statistics headed by the Director General.

The Director General of Commercial Intelligence and Statistics was
responsible for the compilation and publication of almost all the principal
statistical information on demography, crop production and prices,
rainfall, industrial production, education, health and hygiene, mining,
roads and communications, and other subject matters.
In April 1914, a separate Directorate of Statistics came into being.

In January 1925, the Directorate of Statistics and the Commercial Intelligence
Department were merged into a single organization, which was renamed as the
Directorate of Commercial Intelligence and Statistics.
In 1925, The Indian Economic Enquiry Committee recommended the
establishment of a Central Statistical Bureau, along with similar Provincial
Statistical Bureaux, whose “aim was to provide a common purpose and a central
thinking office on the subject of Statistics”. But the Government of British India
did not accept these recommendations.

In 1934, The Committee appointed by the Government of British India under
Messrs. Bowley and Robertson, for facilitating a further study of economic
problems in India, was required, by one of its terms of reference, to make
recommendation about the organization of a Central Statistical Department.
The creation of the Central Economic Intelligence Organization, under the
Economic Adviser, and the emergence of the Department of Commercial
Intelligence and Statistics were the results of these recommendations.

Statistical System after independence of India/ post
independence period
After Independence of India-
A nucleus statistical unit was set up at the Centre in the Cabinet
Secretariat in 1949. This unit was developed later on in 1951 into the
Central Statistical Organization (CSO).

independence period
The main responsibility assigned to the CSO was to bring about
coordination of statistical activities among various statistical agencies
in the Central Government and of Statistical Bureaus of State
Governments, which was set up for similar coordination of activities of
statistical agencies at the State level.

independence period
Professor P.C. Mahalanobis, who is regarded as a pioneer in both
theoretical and professional statistics, was appointed as the first
statistical adviser to the Cabinet, Government of India in January
1949. He was the architect of the statistical system of independent
India.

independence period
National Income Committee was appointed in 1949 to work out a
system for reliable estimation of national income.
The National Sample Survey (NSS) came into being in 1950 to collect
information through sample surveys on a variety of socio-economic
aspects.

 Statistical System after independence of India/ post independence period
In 1954, the National Income Unit was transferred from the Ministry of
Finance to the CSO and a new Unit for Planning Statistics was set up.
In 1957, the subject of Industrial Statistics was transferred from the Ministry
of Commerce and Industry to the CSO.
In April 1961, the Department of Statistics was set up in the Cabinet
Secretariat and the CSO became a part of it.

independence period
In 1972, a Computer Centre in the then Department of Statistics was
set up.
In 1973, the Department of Statistics became a part of the Ministry of
Planning.

independence period
In February 1999, the Department of Statistics and the Department of
Programme Implementation were merged and named as the
Department of Statistics and Programme Implementation under
Ministry of Planning and Programme Implementation.

independence period
In October 1999, the Department of Statistics and Programme
Implementation was declared as the Ministry of Statistics and
Programme Implementation (MoS&PI).

Father of Indian Statistics-
Prof. Prasanta Chandra Mahalanobis
Every year June 29 is observed as National Statistics Day in
our country to create public awareness about the importance of
statistics in socio-economic planning and policy formulation
because Prof. Prasanta Chandra, father of Indian Statistics was
born on 29th June, 1893.

He was a physicist by training, a statistician by instinct and a planner by
conviction.
His contributions were massive on the academic side as the builder of the
Indian Statistical Institute, organizer of the Indian statistical systems,
pioneer in the applications of statistical techniques to practical problems,
architect of the Indian Second Five Year Plan, and much more.

He described statistics as “a universal tool of inductive inference, research
in natural and social sciences, and technological applications’ and ‘as a
key technology for increasing the efficiency of human efforts in the widest
sense”.
Prof. Prasanta Chandra Mahalanobis was born into a family well
established in Calcutta (Kolkata).
His father was Probodh Chandra Mahalanobis, a pioneering
entrepreneur, who successfully ran a dealership in sports goods,
gramophones and records.

Prof. Prasanta Chandra Mahalanobis's mother was Nirodbasini Devi, who was
the sister of Dr. Nilratan Sircar, the eminent physician, educationist, and
industrialist of that time.
He started his education at Brahmo Boys’ School, which was founded by his
grandfather Guru Charan Mahalanobis in 1904.
Prof. Prasanta Chandra Mahalanobis earned a Bachelor degree in Science with
Honours in Physics from the Calcutta University under Presidency College in
1912, before he sailed to England and joined Cambridge University.

Prof. Prasanta Chandra Mahalanobis obtained Mathematics Tripos part I
in 1914, and Physics Tripos part II in 1915 from Cambridge University.
He was very interested in various subjects like amateur astronomy,
philosophy, architecture, and psychology.
After returning to England, Mahalanobis was introduced to the journal
'Biometrika'. He discovered the utility of statistics to problems in
meteorology and anthropology.
He first joined Presidency College in 1915 as a temporary Professor.

In 1922 he became Asst. Professor of Physics and taught Physics for 33
years (1915-1948).
He was also the Principal of Presidency College for a few years and held the post
of Meteorologist in the Alipore Observatory in Calcutta from 1922 to 1926.
On 17th December, 1931, Prof. Prasanta Chandra Mahalanobis set up the Indian
Statistical Institute.
 The Indian Statistical Institute (ISI) was registered on 28 April 1932 at Calcutta
as a non-profit-distributing learned society under the Societies Registration Act,
1860, with Professor P.C. Mahalanobis as its founder Director.

This was set up to carry out research, teaching, training and project
activities, and it gradually became an important part of the statistical
system of India, through its pioneering work on large-scale sample
surveys, design of agricultural experiments, statistical quality control,
planning for national development and use of electronic computers in
statistical work.
By an Act of Parliament, the Institute was declared as an "Institute of
National Importance" in 1959 and the right to hold examinations and
award degrees and diplomas in Statistics was conferred on it.

Mahalanobis was instrumental in formulating India’s second five-year
plan (1956-1961), which laid the blueprint for industrialization and
development in India.
Mahalanobis devised a measure of comparison between two data sets,
now popularly called "Mahalanobis distance". The study is widely used in
the field of cluster analysis and classification.
He also introduced innovative techniques to devise a statistical method
called fractile graphical analysis used to compare socio-economic
conditions of varied groups.

He analyzed data regarding the floods in Odisha and published his
findings in 1926. This analysis later formed the basis for the construction
of the Hirakud dam on the Mahanadi River.
He received the Order of the British Empire in 1942 and Padma
Vibhushan in 1968.
He is also a recipient of the Srinivasa Ramanujan Gold Medal.
On June 28, 1972, Just a day before his 79th birthday, he bid the world
adieu.

On June 28, 1972, Just a day before his 79th birthday, he bid the world
adieu. At the time, he was the Secretary and Director of the Indian
Statistical Institute and the Honorary Statistical Advisor to the Cabinet of
the Government of India.
 Since 2007, June 29 is commemorated as Statistics Day to acknowledge
Mahalanobis’ pioneering contribution in the field of Statistics and
Economics.

Meaning of Statistics
The term Statistics is used in two terms-
i. Plural Sense
ii. Singular sense
In Plural Sense-
Statistics means a collection of numerical facts or estimates- the figure
themselves. For example- figure relating to population, profits of different
units in an industry etc.

Meaning of Statistics
In singular Sense-
Statistics denotes the various methods adopted for the collection, analysis
and interpretation of the facts numerically represented.
In singular sense, the term statistics is better described.

Statistics - Definition
 ‘‘Statistics are numerical statement of facts in any department of enquiry placed in
relation to each other’’. –A.I.Bowley
 ‘Statistics may be called the science of counting’ – A.I. Bowley
 ‘Statistics may be called the science of averages’- A.I. Bowley
 “Statistics may be defined as the science of collections presentation, analysis and
interpretation of numerical data”. - Croxton and Cowden
 “The science of statistics is the method of judging collective, natural or social
phenomenon from the results obtained from the analysis, enumeration or collection of
estimates”- King

Characteristics of Statistics
Statistics consists aggregates of facts;
 It is effected by multiplicity of causes;
It should be numerically expressed:
It must be enumerated or estimated accurately
It should be collected in a systematic manner
 It should be collected for a predetermined purpose
It should be capable of being placed in relation to each other

Objectives of Statistics
To present facts in a definite form.
To simplify unwieldy and complex data.
To use it as a technique for making comparisons.
To enlarge individual experience
To provide guidance in the formulation of policies
To help drawing conclusion from facts effected by a multiplicity of causes.

Importance / Scope of Statistics / Application
of Statistics in various fields
In states and country
Statistics was regarded as the “Science of Kings”. It supplies the essential
information to run the government, Policies are adopted by the government with
the help of statistics.
In economics
In economics, the problems are studied by the use of statistical methods economic
loss is based on the study of collected statistical data. The loss economics refer to
statistics to prove their accuracy. Statistics in economics as given birth to a new
discipline called econometrics

In Business
In the competitive business, the business people face some like shortage is
overstocking, uneconomic crisis etc., which can be solved through statistical
analysis. To a greater extent statistics help the businessman maximize their
profit.
 In Education
Statistics is widely used in education for research purpose. It is used to test
the past knowledge and evolved new knowledge.

In Astronomy
Astronauts study the eclipse and astronomical issues by applying statistics. They rely
on estimation in many cases and it was corrected with the help of statistics.
In accounting
In accounting correlation analysis between profit and sales is widely used. In auditing,
Sampling techniques are commonly followed.

In Banking
In this past developing technology, the banking sector needs a lot of information
about the present and future business development.
In Investment Decision
Statistics helps an investors in selecting securities, which are safe, yielding a good
return an appreciation in the market price.

In Insurance
Statistics is extensively used in the field of Insurance. Actuarial statistics is must of the
insurance company through fix the premium relates which is based on the mortality
tables.
In Research Market
researchers largely depends upon statistical methods in drawing conclusion.

In management
Statistical tools are used widely by business enterprises for the promotion of new
business. It also helps in the assessment of quantum of product to be
manufactured, the amount of raw material, labor needed, marketing avenues for
the product and the competitive products in the market and so on.
In Industry
In Industry statics is used in quality control through control charge which has its
basis on the theory of probability, normal distribution and inspection, which are
based on sampling techniques

 In Medical sciences
In medical sciences, the test of significance by student T –test for testing the efficiency of
new drug, injection for controlling and curing specific ailments is done carried out by
statistics. Comparative study for the effectiveness of different medicine by different
concerns can also be also be made by statistical techniques of T & F test of significance.
 In War
The theory of decision functions propounded by A.Wald can be of great assistance to the
military and technical personnel to plan maximum destruction with minimum effort.
Moreover, the statistical data obtained in the post war period reveal some useful
information for planning future military strategies.

Functions of Statistics
It prevents facts in a definite numerical form
It simplifies the complexity of the data
It provides a technique of comparison
It helps in formulation and testing hypothesis
It helps in forecasting of future trends and tendencies
It studies relationship
It helps the government

Limitation of Statistics
Statistics cannot be applied to individual term
Statistical study qualitative phenomena in indirect form
Statistical law are not exact
Statistical results are uncertain
Statistics is not simple
Statistical data may be incomparable
Statistics is liable to be misused

Statistical Investigation
 The term investigation or enquiry means the search for information or
knowledge.
Statistical investigation or Statistical Enquiry implies search for
knowledge with the help of statistical devices like collection, classification,
analysis, and interpretation etc.
According to Griffin, “Statistical Enquiries have always required
considerable skill on the part of the statistician, rooted in a broad
knowledge of the subject matter area and combined with considerable
ingenuity in overcoming practical difficulties”.

Stages of Statistical Investigation
 Statistical investigation is a long and comprehensive process.
It extends over various stages from initial planning to the final preparation of
reports.
The various stages are:
1. Planning of statistical investigation. 2. Collection of data. 3. Editing of data. 4.
Presentation of data. 5. Analysis of Data. 6. Interpretation of data. 7. Preparation of
the report.

Stages of Statistical Investigation

Planning of
statistical
investigation
Collection of
data
Editing of
data
Presentation
of data
Analysis of
Data
Interpretation
of data
Preparation
of the report.

PLANNING OF STATISTICAL
INVESTIGATION
A proper system is essential for conducting a statistical investigation.
Planning must precede the execution.
Careful planning is essential to get the best results at the minimum cost
and time.
 It is essential to consider the following points while planning a statistical
investigation.
1. Objective of the enquiry should be fully known.

PLANNING OF STATISTICAL
INVESTIGATION
2. Scope of the enquiry should be determined.
3. Nature of information to be collected should be decided.
4. Unit of data collection should be defined.
5. Source of data collection or type of data to be used, that is, primary or secondary
should be decided.
6. Method of data collection, that is, census or sampling method, should be decided
beforehand.
7. Choice of frame should be made.
8. Reasonable standard of accuracy should be fixed.

BUSINESS STATISTICS: A BRIEF HISTORY

Recommended

Recommended

More Related Content

What's hot

What's hot (20)

Similar to BUSINESS STATISTICS: A BRIEF HISTORY

Similar to BUSINESS STATISTICS: A BRIEF HISTORY (20)

More from anjalichaudhary75

More from anjalichaudhary75 (20)

Recently uploaded

Recently uploaded (20)

BUSINESS STATISTICS: A BRIEF HISTORY