Read on Twitter
I see this is generating a lot of interest but if what this data is intended to communicate is GDP growth under the respective leaders than it is wrong...I& #39;ll write a thread under this in a bit. https://twitter.com/StatiSense/status/1311733812280332288">https://twitter.com/StatiSens...
#Thread
What @StatiSense have done is, take the GDP growth rate at inception of the head of state and GDP growth rate when they existed office which is also why you see the final value for each leader ends up being the first for the successive one. /1
What @StatiSense have done is, take the GDP growth rate at inception of the head of state and GDP growth rate when they existed office which is also why you see the final value for each leader ends up being the first for the successive one. /1
This is a known statistical problem in growth representation, the challenge with analyzing growth this way becomes what happened in-between the period under review is abstracted and cannot be immediately deduced from the data. /2
An example to better illustrate. Imagine you are hired for a 5year tenure as the CEO of ABC Ventures a company with an annual revenue turnover of N100M and growing at 20% every year, on your first year you turnaround the business and grow revenue to N10B /3
(a whopping 10,000%) and since growth is harder at scale you then start growing 10% year on year for the rest 4 years of your tenure. This presentation by @StatiSense would represent the performance for the periods as thus /4
{assuming the former CEO took over when the business has a growth rate of 5%}
Former CEO - 5% to 20%
Current CEO - 20% - 10%
/5
Former CEO - 5% to 20%
Current CEO - 20% - 10%
/5
You see how it becomes easy to lose the significant growth that happens in-between and how this misrepresents the overall performance of the two leaders? /6
If the previous CEO at 20% annual growth rate had continued, the business after an additional 5years will ~N249M of annual revenue but instead, the current revenue at year 5 with the new leaders is ~N15B. /7
To solve this, the right metric is the CAGR (compound annual growth rate). The CAGR from 2010 to & #39;15 (even though the decline started from & #39;15 when PMB took over) for GEJ is 8% and for Buhari till 2019 is 2% I stopped at 2019 because it is easy to argue the effect of COVID. /8
This is all I tried to say as a comment in another post and someone called out my wife and daughter.
cc: @c4mbianni @Mrmakushi
cc: @c4mbianni @Mrmakushi
