Measuring the Impact of Free Goods on Real Household Consumption
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pandp.20201054.pdf
Description
Published version
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514.89 KB
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Author(s)
Brynjolfsson, Erik
Collis, Avinash
Diewert, W. Erwin
Eggers, Felix
Fox, Kevin J.
Date Issued
May 2020
Journal
American Economic Association Papers and Proceedings
Publisher
American Economic Association
Citation
Brynjolfsson, Erik, Collis, Avinash, Diewert, W. Erwin, Eggers, Felix and Fox, Kevin J. 2020. "Measuring the Impact of Free Goods on Real Household Consumption." American Economic Association Papers and Proceedings, 110.
Version
Final published version
Abstract
We suggest a methodology that allows statistical agencies to form approximations to the benefits that flow to households from new free goods. The present production-oriented GDP measures are not satisfactory for measuring real household consumption and will be increasingly inaccurate as free goods, such as those made possible by the digital revolution, become more important. Advertising expenditures are not an adequate substitute for measuring the benefits of new goods to the household sector. Instead, we need to draw on estimates such as those provided by choice experiments.
MIT Department
Sloan School of Management
Terms of Use
Article is made available in accordance with the publisher's policy and may be subject to US copyright law. Please refer to the publisher's site for terms of use.
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DOI of Published Version
https://doi.org/10.1257/pandp.20201054
