Econometrics is the application of statistical methods to economic data and is described as the branch of economics that aims to give empirical content to economic relations. More precisely, it is "the quantitative analysis of actual economic phenomena based on the concurrent development of theory and observation, related by appropriate methods of inference". An introductory economics textbook describes econometrics as allowing economists "to sift through mountains of data to extract simple relationships". The first known use of the term "econometrics" (in cognate form) was by Polish economist Paweł Ciompa in 1910. Jan Tinbergen is considered by many to be one of the founding fathers of econometrics. Ragnar Frisch is credited with coining the term in the sense in which it is used today.
Statistics is a branch of mathematics dealing with the collection, analysis, interpretation, presentation, and organization of data. In applying statistics to, for example, a scientific, industrial, or social problem, it is conventional to begin with a statistical population or a statistical model process to be studied. Populations can be diverse topics such as "all people living in a country" or "every atom composing a crystal". Statistics deals with all aspects of data including the planning of data collection in terms of the design of surveys and experiments. See glossary of probability and statistics.
Econometrics may be defined as the quantitative analysis of actual economic phenomena based on the concurrent development of theory and observation, related by appropriate methods of inference.
Paul Samuelson, Tjalling Koopmans, and Richard Stone. "Report of the evaluative committee for Econometrica." Econometrica- journal of the Econometric Society. (1954): 141-146.
To understand God's thoughts we must study statistics, for these are the measure of his purpose.
Florence Nightingale, quoted in Karl Pearson, Life of Francis Galton, vol.II, ch.xiii, sect.i
I wish that people would be persuaded that psychological experiments, especially those on the complex functions, are not improved (by large studies); the statistical method gives only mediocre results; some recent examples demonstrate that. The American authors, who love to do things big, often publish experiments that have been conducted on hundreds and thousands of people; they instinctively obey the prejudice that the persuasiveness of a work is proportional to the number of observations. This is only an illusion.
Alfred Binet (1903). L’Etude experimentale de l’intelligence. Paris: Schleicher Freres and Cie. p. 299; As cited in: Carson (1999, 360)