The macroeconomic implications of measurement problems due to digitalisation

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Title: The macroeconomic implications of measurement problems due to digitalisation
Author: Itkonen, Juha
Organization: Bank of Finland
Suomen Pankki
Series: BoF Economics Review
Series year: 2019
Series number: 1/2019
Year of publication: 2019
Publication date: 25.3.2019
Pages: 26
Subject (yso): tilastot; digitalisoituminen; mittaus; bruttokansantuote; tuottavuus; inflaatio; mittausvirheet; hyvinvointi (taloudellinen); teknologia
Keywords: Suomi; taloustilastot
JEL: E01; E31; D63; D23; O33
Other keywords: GDP; digitalisation; statistics; productivity; technology; digital economy
Abstract: The impact of digitalisation is not fully reflected in economic statistics. Even though commonly used economic metrics such as GDP are still relevant in assessing the state of the economy, the production of statistics should be developed to measure the digital economy better. The most significant measurement challenges caused by digitalisation relate to new goods, free services, changes in quality and the movement of intellectual capital between countries. Due to digitalisation, GDP and productivity growth may have been understated and the rate of price inflation overstated. Measurement errors alone do not explain the exceptionally weak development in recent years, nor do they eliminate the problems of the Finnish economy and the key challenges for economic policy. Digital technology has, however, improved our well-being in ways that are difficult to measure in money.

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