Source: Visitors take photos at Google Headquarters in Mountain View, Northern California. China News Agency reporter Liu Guanguan
According to CNBC, the Federal Reserve is trying to figure out the economic value of free Internet services. The answer may help the Federal Reserve solve the century dilemma of the contemporary economy: the current expansion cycle of the U.S. economy is the longest in history, but productivity growth is weak, and GDP growth is stable, but far from surprising.
In a recent speech, Federal Reserve Chairman Powell asked whether it was possible that the statistics themselves had problems. For example, GDP measures the value of products and services purchased and sold. However, many of the great technological innovations of the Internet era are free, such as search engines, e-mail, GPS and even Facebook. Official economic statistics are not designed to take into account the benefits created by these products for businesses and consumers.
Good decisions require good data, but the data we have is clearly not good enough, Powell said.
Instead, Powell cited a study by an MIT economist and other experts, in which the authors used a large number of questionnaires to estimate the value of money in modern life tools.
The median amount of money needed to give up Facebook for a month was $48, according to the study. The median cost of giving up streaming services like YouTube for a year is $1173. Search engines are the most valuable, and the median amount of money needed to keep consumers away from Google for a year is as high as $17,530.
Over time, we are spending more time in a day interacting with the Internet or using its services on smartphones, researcher Brian Jofson told CNBC. A large part of our economy has been neglected by GDP.
He proposed a statistical method called GDP-B, which replaced the existing output statistics with income calculations. According to his algorithm, the positive benefits of Facebook alone can generate an additional 0.05 to 0.11 percentage points of GDP growth.
Economists cited by the Federal Reserve, who studied data transmitted by broadband, cable and WiFi, found that if the contribution of the digital economy was fully included, GDP would have been 0.5 percentage points higher in the past decade.
Source: Responsible Editor of CNN: Wang Fengzhi_NT2541