Acta academica karviniensia 2014, 14(3):148-160 | DOI: 10.25142/aak.2014.056

APPLYING BENFORD'S LAW BY TESTING THE GOVERNMENT MACROECONOMICS DATA

Michal Plaček
SVŠE Znojmo,Department of finance and accounting, Loucká 21, E-mail: placek@svse.cz

This article builds on research published in the article "Fact and Fiction in EU Governmental Economics Data" (Rauch, Göttsche, Brähler, 2011). By exploring the possibilities of applying Benford's Law as a useful instrument for detecting data manipulation, this instrument is applied to the Czech Republic, particularly in the monthly data of exports and imports for the period 1996-2012, which make up the trade balance. We use the Z test as the test criterion and the first and second digits are tested. The primary aim of the article is to summarize the current theory regarding Benford's Law and the practical applications of this theory to the governmental macroeconomic data.

Keywords: Benford's law, Z test, Government data, manipulation
JEL classification: E01, M42

Received: June 10, 2013; Accepted: September 23, 2014; Published: September 30, 2014  Show citation

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Plaček M. APPLYING BENFORD'S LAW BY TESTING THE GOVERNMENT MACROECONOMICS DATA. Acta academica karviniensia. 2014;14(3):148-160. doi: 10.25142/aak.2014.056.
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