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measuring the digital economy

measuring the digital economy. Jennifer Ribarsky Head of Section, National Accounts Division, STD. 11 th Meeting of the Advisory Expert Group on National Accounts 5-7 December 2017, New York. Where is the digital economy in macroeconomic statistics?.

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measuring the digital economy

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  1. measuring the digital economy Jennifer Ribarsky Head of Section, National Accounts Division, STD 11th Meeting of the Advisory Expert Group on National Accounts 5-7 December 2017, New York

  2. Where is the digital economy in macroeconomic statistics? • The digital transformation is largely hidden in the core economic accounts and challenges our conceptual frameworks and measurement approaches • Exacerbating long standing challenges in price measurement • Reopening questions about the statistical recording of knowledge embodied in data • Creating larger wedges between income and material well-being (consumer surplus and free services) • Reinforcing the need to improve measurement of ‘informal’ activities, and • Raising questions about the ‘participative’ production of consumers

  3. Measuring macroeconomic statistics in a digital economy • Response of the international statistical community • OECD Measuring GDP in a digitalised economy • OECD-IMF Can potential mismeasurement of the digital economy explain the post-crisis slowdown in GDP and productivity growth? • OECD-IMF Measuring consumer inflation in a digital economy • Advisory Group on measuring GDP in a digitalised economy • Consists of NSOs, Eurostat, IMF, UN, and members of OECD WP Measurement & Analysis of the Digital Economy (WPMADE) • Surveys, discussions and in-person meeting November 2017 • TF on International Trade in Services Statistics (TFITS) exploring similar issues • Measuring digital trade framework presented at BOPCOMM 24-26 October 2017

  4. Going Digital Horizontal Project • OECD’s project “Going Digital”, making the transformation work for growth and well-being • Multidisciplinary, cross-cutting initiative to help policymakers better understand the digital transformation that is taking place • Modules • Jobs and skills; Productivity, competition and market openness; Well-being in the digital age • Measurement : Developing new tools and a longer-term agenda for measuring the digital transformation • Collaborative projects • Policy design; Digital security and resilience; Foresight scenarios

  5. Price indices for ICT assets and communication services Average annual growth rate in percentage, 2010-2015 (or latest available year) UK showed increases of nearly 3% per year Australia and France showed declines of more than 3% per year Notes: Data reported for Spain for ICT equipment and Computer software and database correspond to the period 2010-2014. Data reported for Austria for Communication services correspond to the period 2011-2015. Source: OECD National Accounts Statistics, OECD Productivity Database, OECD Prices and Purchasing Power Parities database, Australian Bureau of Statistics, U.S. Bureau of Economic Analyses and Statistics Canada, February 2017

  6. Impact on GDP growth, using alternative ICT & communication prices Belgium shows largest impact 0.4%-points Most countries show around 0.2%-points

  7. Goal: Estimate Broad Cost of Living Index Corrections to growth rate of consumption deflator

  8. Estimated impact of “free” media activities on GDP growth, 2009-2013 Driven by web portals industry, increasing on average 20.6% between 2010 and 2013 Largest impact in the United Sates, the average annual growth rate would increase by 0.07%-points Average 2009-2013, percentage points Notes: Data for BEL, KOR and POL refer to 2012-2013, for FRA, GRC to 2010-2013 and for the USA to 2011-2013. Source: OECD calculations based on data from OECD SDBS database, OECD Annual National Accounts database and US Census Bureau data. The GDP deflator was used for deflation purposes.

  9. OECD Advisory Group on Measuring GDP in a Digitalised Economy

  10. Advisory Group on Measuring GDP in a Digitalised Economy • Consists of 40 members: NSOs, Eurostat, IMF, UN, and members of WPMADE • Survey of Digital Economy Typology • Initial framework based on digital trade framework • Questions on country practices with regards to digital intermediaries • Identifying data gaps • How to highlight the digital economy

  11. Digital economy typology • The majority of the AG agreed with the multi-dimensional scope proposed • Different views of the digital economy depending on what you want to study • Some refinement was needed to make it operational for a potential satellite account on the digital economy • Dimensions further disaggregated (or dissected in different ways) • Additional category specifying SNA production boundary

  12. Potential Framework:Dimensions of the digital economy

  13. Nature of transaction (‘how’) • Digitally ordered • The sale or purchase of a good or service, conducted over computer networks by methods specifically designed for the purpose of receiving or placing orders (follows OECD ecommerce definition) • Platform enabled • Transactions that are facilitated via online intermediary platforms that match buyer and supplier (e.g. eBay, Amazon, Uber) • Platform may be based domestically or abroad, foreign or domestically owned • Digitally delivered • ‘downloadable’ services and data flows (software, data, database services, etc.)

  14. Product (‘what’) • Traditional: Goods and services • BUT: importance of data/information flows that may not result in monetary transaction, but may support one • e.g. Facebook: advertising revenue is captured, the data flows are currently not > Measurement of consumer surpluses? • E.g. Use of public goods (open-source/free software)> currently no imputations are made

  15. Actors involved (‘who’) • Producers • Can be broken down in a number of ways • Institutional sector (highlights the importance of ROW) • Categories of industries • Digital/non-digital industries and/or producers of digital products • Users • Can be broken down in a number of ways • Institutional sector (again including ROW) • Industries, and also consumers of final demand (notably households)

  16. Other columns of framework • Enablers • Important pillar of the digital economy • Namely investment and infrastructure channels that help drive digital transformation • SNA production boundary • Not all transactions are currently within the SNA production boundary

  17. Questions on overarching framework • Do you agree with the broad multi-dimensional scope proposed? • Do you think it is useful as an organising principle?

  18. Making the Framework Operational

  19. Proposal • Preliminary stage… it is ambitious • Driven by conceptual considerations and policy needs • Could be expanded… • to develop gross and net capital stock estimates (service lives, depreciation rates) and capital services • Price and volume measures

  20. Organising principle • Nature of the transaction is organising principle but… does not dictate what should be digital goods and services or digital industries. • Transactions that are in scope… • only captures transactions that are either ‘digitally delivered’, digitally ordered, or platform enabled • Satellite account includes a separate section on enablers (investment matrices)

  21. Investment matrices

  22. Production & supplementary information

  23. Summary • Issues paper builds upon the overarching framework • Satellite account designed to be flexible • Does not define the digital economy but highlights important transactions (and transactors) • Despite bold ambition and wide coverage it is by no means exhaustive… • next phase… • Price and volume measurement • Capital stock (gross and net, service lives, depreciation rates etc.) or estimates of capital services

  24. Questions on proposed satellite account • What is your opinion of the initial proposal? • Does the proposed satellite account framework identify all the relevant transactions? • Is it missing anything, if so what? • Does it meet, at the very least, the main policy needs? • AEG members invited to provide feedback on questions posed in the issues paper.

  25. Thank you!

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