Economist Kallum Pickering says Britain’s ‘productivity crisis’ has been exaggerated because everyone forgot to include all the cool stuff we gain from technology.
What it means: Economies are described as productive when they create a lot of output (anything of value, like money or happiness) without having to put in a lot of inputs (like hours of work or tons of effort). High productivity is considered important by people who think it’s a good measurement of how well-off people living in that economy are.
For years, the UK has been considered about as productive as a university student whose discovered their favourite bar is running an all-day Happy Hour. It has the lowest productivity of the G7, a group of rich countries. But Pickering thinks this might just be because statisticians have been doing the maths wrong.
He points out that we get a lot of value from digital technologies like Amazon and Netflix, which isn’t being counted in our output tally. His reasoning is that when you do something like use Google to prove all your mates wrong in the pub, everyone gains (smug satisfaction for you, knowledge for them) without having to put in much time or effort.
So the next time someone tells you off for obsessively binge-watching The Sopranos you can retort that you’re boosting the economy.
We live in the same neighbourhood, area, country, and planet with about seven billion other people, and our economies inevitably overlap all the time. That means the economic choices we make might have consequences outside our control, and someone else’s choices might have a direct effect on your economy – even if you’ve never met them before…