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4. Benefits of Legal Metrology to the Economy4.1 Trade MetrologyIn trade based on measurements Trade Metrology is generally perceived as providingthe following benefits1. educed disputation and transaction costs

!rom its beginning measurement was recognised as a provider of ob"ectiveinformation. #owever when used in trade transactions where the measurement

process lac$ed transparency% and there was asymmetry of information between thetrader providing the measurements and the trader accepting these measurements&usually the purchaser in retail transactions% the producer in farm produce transactionsand the smaller business in commercial transactions' there was considerable scope foruncertainty% disputation% transaction costs and mar$et inefficiency. &1((% 1(4% 1()'.These transaction costs can result from concerns about the accuracy of themeasurement e.g. short measure% and the consistency of the measurement e.g. payingmore than other customers.Typical e*amples of trade measurement transactions that may lac$ transparency and

are difficult to chec$ are1. +etroleum sales to service stations and motorists.,. Billing of telephone calls.(. -ale of firewood4. -ale of grain and rice by farmers based on moisture measurements.. -ale of alcohol where stamped glasses are not used/. 0tility measurements i.e. electricity% water and gas.The -tate metrological compliance system was developed to provide% throughlegislative reuirements% trust and confidence in the measurements and minimisedisputation and transaction costs. Elements of the system included pattern approval ofmeasuring instruments to ensure they were fit for purpose and third party auditing andinspection of instruments to ensure accuracy and detect fraud.This central role of the -tate in setting rules was emphasised by The 2orld Ban$ inits 1))3 2orld evelopment eport on 5The -tate in a 6hanging 2orld7 &)3' thatmade the point85an effective -tate is vital for the provision of the rules and institutions that allowmar$ets to flourish. 2ithout it sustainable development both economic and social isimpossible7.#owever in recent years a number of governments in developed countries havereduced their commitment to their metrology system and placed greater reliance onthe mar$et to resolve measurement disputes.

,. 6onsumer protectionMeasurement% and goods pac$ed by measure% has generally replaced number andsimple measures &buc$et% plate etc.' as the basis of transaction for a wide range ofconsumer commodities and products. The increased consistency of these1/measurements% when adeuately controlled% has significantly reduced disputation% andfraud and increased the efficiency of the mar$etplace.(. Level playing field for commerceMetrological control ensures fair trading by eliminating the use of short measure toobtain commercial advantage over competitors in the mar$et place and% through

pattern approval and certification% eliminates the manufacture and sale of many trade

measuring instruments that are not fit9for9purpose and would not meet internationallyrecognised standards.

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4. Effective stoc$ controlThe aggregation of trade measurements by individual businesses provides accurateand effective stoc$ control to facilitate the ordering of new stoc$. This is a spill9over

benefit of the trade measurement system..6ontrol of fraud

:s well as the control of fraud in the mar$etplace by -tate inspection% stoc$ control bymeasurements can also provide effective fraud control for individual businesses.+attern approval and certification also ensures that the design of measuringinstruments do not facilitate fraud./.!ull collection of government e*cise and ta*es based on measurement;overnments of both developed and developing nations collect significant amounts ofrevenue through e*cise and resource rent ta*es based on measurement. +apua

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Measuring instruments used for regulatory purposes are able to provide continuousmonitoring and greatly increase the probability of apprehension. The ob"ectivity of themeasurements also provides enhanced acceptance by industry and the community,. -ound evidential basis for the measurementsThe legal metrology authority can provide a sound evidential basis for regulatory

measurements by providing for certification of standards% measuring instruments%measurements and reference materials under

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reduce accidents by changing peoples behaviour% providing early warning signals andproviding effective enforcement of safety reuirements. Birch &/3' provides ane*ample of the impact of the use of radar speed devices and breathalysers on the:ustralian road toll.The economic impact of such reduction in fatalities can be very high. -tiglit= &'

provides a discussion on the economic value of a life with numbers of betweenF0-,million and F0-million &in 1))3 dollars'.: study in Gictoria% :ustraliaestimated the saving to the community from a reduction in road fatalities of (> wasappro*imately F:1./ billion4. Improvement in the natural environmentLegal metrology has a wide range of applications in the monitoring and control of thenatural environment &('. Aleppan et al &11(' provide an e*ample of resource controlin the fishing industry and @IML have developed a number of Internationalecommendations for instruments measuring organic and metal pollutants% pesticidesand to*ic substances and automobile emissions. Improved health from standardisation of measurement and testing

Legal metrology through timely and accurate diagnosis provides significant economicand social benefits in medicine and health. The