Business Social Media and Updates

Productivity Gains Masked by ‘Ghost GDP’ Distribution Gap

This is the last point I will make regarding the piece, as I am really glad to see that name calling has resolved to constructive discussion and a genuine exchange of thoughtful commentary like that offered by Professor Damodaran. If you’re someone who got your opinion that Citrini doesn’t understand the accounting identity for GDP from the media, understand that what happened was not “they found a major flaw” but “they didn’t have anything better to say so they distorted what we said in order to criticize it”. The term “Ghost GDP” was presented as an expression coined by PUNDITS to reflect how the majority of laid off workers FELT in response to boasts about record productivity that resulted in more investment into compute rather than income for labor. This isn’t a crazy thing - we already have the term “K Shaped Economy”. We already see how the bottom 50% of earners’ spending is not accurately reflected by the CPI basket and this causes them to mistrust the report. I understand C + I + G + NX = GDP. I also understand that is a tautology that tells you nothing about the distribution of income or how it circulates through the consumer economy. And, surprisingly unlike many in the media, I understand how to read.