Data, variables and their sources

To solve any economic problem, we need data: facts and figures that give evidence for a sound solution.

A quantity whose value changes is a variable: the price of onions, the rainfall in a month, the food grain output of India from year to year. Each value it takes is an observation. If you record your family's electricity bill every month for a year, the bill is the variable, and you have twelve observations.

Data come from two kinds of source:

• Primary data are collected first-hand by the investigator, through his or her own enquiry. If you ask the students of your school which film star they like best, the answers are primary data for you.
• Secondary data have already been collected and processed by someone else, such as a government department or another researcher. They are found in government reports, newspapers, books, journals and websites. A student who takes figures from the internet for a project is using secondary data.

The same data can be both. Data are primary for the person or agency that first collects them, and secondary for everyone who uses them later. If you publish a survey report, it is primary data for you, but anyone who uses your report is using secondary data.

Secondary data save time and cost, since someone else has already done the work. But you must check carefully that they suit your purpose.