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Economy in Brief

The Netherlands' Second Quarter Decline in GDP - A  Result of Statistical Errors?
by Louise Curley August 16, 2004

Of the euro zone countries that have reported second quarter Gross Domestic Product results, the Netherlands is the only one to date, to show a decline. In percentage terms the decline was -0.20% and, in euros, 191 million.

Looking at the details, one finds that consumption was up slightly and net exports were up substantially. Together they rose by 751 million euros. The rise was offset in part by a decline of 536 million euros in gross capital formation, made up of a 544 million euro decline in fixed capital formation and a rise of 8 million euros in inventory accumulation. A shift in the statistical discrepancy from a positive 82 million euros to a negative 324 million euros more than offset the remaining positive influence of consumption and net exports. The change in the discrepancy was 406 million euros compared to the change in the total of 191 million euros.

These details are perhaps a good reminder of the probabilistic nature of the national accounts data. A 0.20% decline in GDP is probably not significantly different from a rise of the same magnitude.

The Netherlands GDP Q2 04 Q1 04 Change
    (Millions 1995 Euros)      
Consumption 68258 68184 74
Gross Fixed Capital Formation 18425 18969 -544
Inventory Change 31 23 8
Net Exports 6039 5362 677
   Exports 67148 64188 2960
   Import -61109 -58826 2283
Statistical Discrepancy -324 82 -406
Gross Domestic Product 92429 92620 -191
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