Transcript Can Mismeasurement of the Digital Economy explain the U.S.

Comments on
Can Mismeasurement of the
Digital Economy explain the U.S.
Productivity Slowdown?
MIHO TAKIZAWA
TOYO UNIVERSITY
Hitotsubashi-RIETI International Workshop on Real
Estate Market, Productivity, and Prices
October 13th, 2016
1
Summary
Computer and peripheral prices
Annual data
Percent
5
0
-5
-10
-15
-20
-25
 Mismeasurement in ICT
& LP growth slowdown (04～)
Underestimation of quality
⇔ Upward bias in price
-30
NIPA
Alternative
-35
⇔ Downward bias in output
-40
1960 1964 1968 1972 1976 1980 1984 1988 1992 1996 2000 2004 2008 2012
Reinsdorf(2016) Figure3
-45
⇒ Alternative price indexes!
2
Summary (cont’d)
 Does it help? NO, it does NOT.
Adjustments to growth in output per hour
Business sector, percentage points per year
Percentage points
4
intangibles
software, specialized equipment
computers/communications
3.5
3
Published
data
2.5
2
other
1.5
1
 Price adjustments ⇒ Very tiny
effect on productivity dynamics
 Other measurement issues
does not work either…
0.5
0
-0.5
1978-1995
1995-2004
2004-2014
Source: BLS, Fernald (2014a), and authors' calculations. Other comprises Internet, free digital services, globalization, and fracking.
Reinsdorf(2016) Figure4
Internet-based digital services
improve in consumer welfare,
but they do not increase GDP…
3
Comment 1:
From the semi-macro viewpoint
Q. Any other important adjustments?
 E.g., Low productivity growth in service industry
 Any chance to extend the current discussion
toward this direction (i.e., quality/price/output
bias in service industries)?
4
Comment 2:
From the micro viewpoint
Q. Any industry- or firm-level heterogeneity?
 E.g.(a), highly digitized warehouse (Amazon)
 E.g.(b), internet-monitored bulldozer (Komatsu)
 Bias associated with mismeasurement in “A”
≠ That in “B”
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Comment 3:
Finally, why low productivity?
 Little effect of mismeasurement in ICT
goods on low productivity
 Little effect of globalization (GVC) on low
productivity
 Complementary relation between IT and
intangibles?
 More intangible investments are required?
 Just return to the old pass?
6
Minor comments
 Labor productivity (output per hour)
is a good measure for technology (how
about TFP)?
 Can ICT substitute for unskilled labor
and/or skilled labor?
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