KL, nevertheless, it is precisely this fact that is so disturbing: a small share of the economy, PC manufacturing and tech hardware investment, distort the entire data series enormously.
i haven't seen the article yet and can't really comment in depth - but the numbers strike me as understated.
e.g. in '98, real growth of $8,6 bn. in tech hardware investment was transformed into $145 bn. via hedonic adjustments. that's not a negligible distortion. imo, if productivity really grows so fast on a macro level as is suggested, this should easily be captured by measuring REAL output, in real dollars.
after all, reality should reflect those improvements. if it doesn't, they don't exist, or rather, they are not as big as the numbers intimate.
note, if Germany had employed the same statistical methodology, the BuBa has calculated the changes in price indices and investment growth accounts would be enormous - there's a difference between prices falling by 20% (real world) or 80% (hedonic world). or tech investment growth changing by 170% last year. the point is, when comparing US and European economic performance, we're not comparing apples to apples. but the currency markets are e.g. trading as if we were.
there has been an extensive debate on various threads on the subject already...i'll see if i can find those posts later and link them here.
regards,
hb |
