I wanted to recommend the blog by Djavad Salehi-Isfahani at Brookings Institute called the Tyranny of Numbers which set the record straight on several economic statistics that are often thrown about in the media without concern for their accuracy, especially Iran’s employment, education, poverty, and income distribution. These figures are usually used to portray Iran on the verge of economic collapse, largely due to wishful thinking and also as psychological warfare, but these figures don't stand up to scrutiny.
For example, on the oft-quoted claim that inflation rates in Iran are supposedly twice the official figures, Salehi-Isfahani writes:
Every time a reporter mentions Iran’s inflation or unemployment data, they feel obliged to assert, sometimes quoting unnamed experts, that actual numbers are probably twice the official rates. But most people who work with numbers know well that officials can manipulate one year’s inflation rate or two, but if the rates are misreported for a number of years, the mere effect of compounding will soon reveal their hand. If you take an inflation rate twice the reported rate for the last 15 years, the price level in 2008 would be about 130 times higher than it was in 1993, nearly ten times higher than the official rates indicate. It is easy to show that under reporting inflation by 50% each year for 15 years produces some very absurd results.
I've mentioned before how Djavad Salehi-Isfahani set the record straight on Iran's poverty rates, and how Kelly Campbell of the U.S. Institute of Peace exploded the myth that Iran is wallowing in an economic crisis:
The belief that Iran suffers from dire economic conditions is one of four myths circulating about Iran's macroeconomic performance. Iran's economy has actually performed well in aggregate terms, with a moderate rate of growth in the last ten to fifteen years, including healthy GDP and per capita growth in investment. In the last three years, Iran's actual growth rate has averaged 5.8 percent.
Nor do economic indicators support assertions by some observers that inflation is much higher than the rate stated by the Iranian government. In the last fifteen years, the consumer price index (CPI) has increased by a factor of forty-two; if the inflation rate were actually twice the reported rate, the CPI would have increased by a factor of 950. Prices have increased by a factor of five in the last ten years, not twenty, as some claim. While this rate of inflation is cause for concern, it is in line with the depreciation of the exchange rate.
The third myth is that Iran suffers from widespread poverty and rising inequality. The poverty rate actually declined throughout the 1990s and continues to fall, and is low by international standards—especially when compared to that of other developing countries. Government public service and social assistance programs have helped to reduce poverty, particularly in rural areas. In addition, economic inequality throughout Iran has remained fairly stable and does not appear to be increasing.
The final myth is that unemployment in Iran is twice the official rate. Although the unemployment rate is high, it has declined since 2000 and reached 11.2 percent in 2004.2 While official statistics match World Bank estimates, the current government has failed to generate sufficient job growth to meet the needs of Iran's young, educated population. For these youth, unemployment often lasts two to three years, which has resulted in more young Iranians living with their parents well into their twenties...
The ease with which certain false economic statistic are repeated and take on a life of their own despite their falsity was made clear to me several years ago when I inquired on Gulf2000 about the source of the oft-repeated (in those days) claim that Iran had the highest brain-drain rates in the world. This was falsely attributed to the IMF by an RFE/RL Radio Farda report. It turned out that there was no such IMF report as the AIC later confirmed:
Report on IMF Study Regarding Iranian "Brain Drain" Unsubstantiated
Perhaps in response to some queries by AIC last week, RFE/RL today published a clarification of their story in the March 15th edition of the Iran Report. The story in question referred to an alleged recent IMF report determining that Iran suffers from the “world’s highest rate of brain drain.” We believe it is important for readers to be aware that this IMF report does not appear to exist. 2004-04-12
The only IMF report that did exist was published in 1998, and had relied on figures from 1990 -- and still did not support the spin put on it by RFE/RL.
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