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THE GROWTH OF THE DOMESTIC' PRO/DUCT
The Liberian National Accounts; Estimates and Guesstimates
One of the indicators of economic growth is the change in Gross
Domestic Product, and it would be particularly interesting to see
in the case of Liberia how the value of goods and services produced
in the country has developed. However» there are many complicating
factors which must be realised and dealt with before
any conclusion can be drawn.
First, given the fact that the Liberian economy (and society) is
characterised by a traditional and a modern sector, a distinction
must be introduced between goods and services produced within the
monetary sector of the economy and those produced by the subsistence
sector. However, it was not until 1975 that, for the first
time in the history of National Accounting in Liberia, relatively
detailed information was made available on the activities of the
subsistence sector (11).
Secondly, prior to 1964» there were hardly any reliable estimates
made of the Gross Domestic Product in the monetary sector. In 1966,
for the first time in the country's history, detailed and relatively
reliable information on the value and the composition of G.D.P.
was" made available by the Harvard Advisory Group (12). In the early
196O's the Northwestern University Team had made an analysis of the
estimated components of national income from 1950 to 1960 but it
emphasised explicitly that lack of reliable information concerning
various components (had) made the data underlying these estimates
very poor, especially for the years 1950 - 1954 (13). The Harvard
Advisory Group, therefore, subsequently adjusted and revised some
of the estimates of the Northwestern University Team.
Thirdly, both the Northwestern University Team and the Harvard Advisory
Group had used the "income-approach" to estimate G.D.P. Initially
this method was also used by the Department of Planning and
Economic Affairs. In 1969 the Department of Planning and Economic
Affairs for its estimates of G.D.P. changed over to the "production-approach"
although it continued to estimate at current prices.
Unfortunately, the change of method as well as the haphazard character
of the Department's estimates resulted in considerable inconsistencies.
Also, the data presented were characterised by their
deficiencies and hence by their lack of reliability. Furthermore,
after 1969» no consistent or usable time series are available as an
I.B.R.D. Economic Mission concluded in 1973 (14). The mission,
therefore, prepared its own series of G.D.P. estimates for the
years 1964 through 1972.
Fourthly, it was not until 1975 that attempts were made to calculate
G.D.P. at constant prices. However, the reliability of the
data presented by the Ministry of Planning and Economic Affairs is
severely tested by the (continued) lack of consistency. This perpetuates
the lack of a usable time series needed to analyse the