INFLATION
BRIAN KANTOR: Measures do not reflect technology benefits
The benefits of the technological revolution that can be seen and felt taking place are not at all obvious in the measures used
Automation, robotisation and miniaturisation are changing wondrously the way goods and services are produced and consumed, including the medical treatments that can keep people alive and healthy for longer. To these forces of change could be added the internet of things, which connects people ever more effectively. However, the benefits of the technological revolution that can be seen and felt taking place are not at all obvious in the measures used. US productivity growth is said to be continuing to grow very slowly. Real GDP is growing as slowly, as are wages and incomes adjusted for inflation. It is apparent that Americans are not getting better off at the pace they used to and are frustrated with the politicians they hold responsible. Is people’s intuition at fault, or is there something wrong with the way in which the prices of the goods and services consumed over time are compared? All measures of output and incomes are determined in money of the day — calculated and agreed to...
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