Valuing 'Free' Media in GDP: An Experimental Approach (PDF)

‘Free’ consumer entertainment and information from the Internet, largely supported by advertising revenues, has had a major impact on consumer behavior. Some economists believe that gross domestic product (GDP) growth is badly underestimated because GDP excludes online entertainment (Brynjolfsson and Oh 2012; Ito 2013; Aeppel 2015). This paper introduces an experimental GDP methodology which includes advertising-supported media in both final expenditures and business inputs. For example, Google Maps would be final expenditures when it is used by a consumer to plan vacation driving routes. On the other hand, the same website would be a business input when it is used by a restaurant to plan delivery routes.

Leonard Nakamura , Jon D. Samuels , and Rachel Soloveichik