Home » World News » How the US economy is being recalculated

How the US economy is being recalculated

Enter your email address to follow this blog and receive notifications of new posts by email.

Join 540 other followers


Error: Twitter did not respond. Please wait a few minutes and refresh this page.


The way the US economy is measured has changed, to include the amount spent on intellectual property outlays such as pop song production and drug patents for the first time.

“GDP is probably the single most important statistic affecting businesses, households, and governments,” says Steve Landefeld, director of the Bureau of Economic Analysis (BEA), which measures gross domestic product – the total amount of goods and services produced in the US economy during a given quarter.

Calculating GDP, he says, is incredibly difficult, because “it’s a continually changing economy that we’re chasing”.

Now, in what the BEA says is the biggest change in the calculations since 1999, the way that US economic activity is reported has been updated.

The goal is to finally include something many have already noticed: the shift away from the production economy of factories and farms towards the knowledge economy – the investment and economic production in intellectual property, which includes everything from the amount spent on writing a hit TV show to researching a cancer cure.

Start Quote

Overall it’s a very significant addition to GDP – around 2.5%”

Steve Landefeld
BEA director
Why are the calculations changing?

Think back to 2007. It was the year of the franchise: Spider-Man 3 and Shrek the Third topped the box office.

For economists, these films were some of the most mysterious products created in the US economy that year.

Although revenues from the box office, as well as DVD sales and TV subscription fees, were included in the GDP calculations, not a single cent spent on making these films – or any song or TV show ever made – has been included in the way economists calculate GDP.

In fact, the BEA estimates that in 2007, the total amount spent on producing creative output such as films, TV and music was $70bn (£46bn at today’s exchange rates).

However, because of the way GDP was calculated at the time, none of that was included in the output figure.

If you added in the amount spent on research and development – such as producing a new blood pressure drug or computer chip – that’s another $300bn that wasn’t counted.

Now, those expenditures, as well as tweaks to how pensions are calculated as part of economic activity, will be included in the figures.

How do you measure the value of “Single Ladies”?

It’s easy enough to understand how the investment in Beyonce’s latest single contributes to the US economy (beyond the dance moves, of course). Songwriters are hired, studio managers put in extra hours and so on.

But putting an actual figure on how much is invested is “really hard”, says Mr Landefeld, particularly when it comes to the economic contribution of intellectual property such as patents and copyrights.

“This stuff is not bought and sold in markets. You don’t say: ‘Hey, I need a patent for a new drug, let me go out and buy one.’

“There’s no marketplace, like there might be for a new building to evaluate prices.”

So the statisticians at the BEA have tried since 2005 to figure out the best way to tabulate the economic output of all of the intellectual property production that we can intuitively tell is going on around us.

They’ve essentially created approximations of pricing models, using input from businesses and leaders around the globe.

“The most similar change we did to this was back in 1999, when we first capitalised [included in GDP] computer software,” says Brent Moulton, head of national accounts at the BEA and the man tasked with creating and implementing the GDP revision formula.

“I think we learned that it would be better to first develop this type of estimate where we could go around and talk to users and experiment with different approaches.”

Start Quote

As the world becomes more and more global, it’s just harder to track down these production relationships”

Brent Moulton
Head of national accounts, BEA
Adding $370bn to the US economy seems like a lot. What’s the impact of these changes?

“Overall it’s a very significant addition to GDP – around 2.5%,” says Mr Landefeld.

Some claim that the decision might be seen as a political ploy by the Obama administration to inflate the US economy – although this is a view that’s widely been discredited.

But on the other hand, the impact won’t be as big as you might expect, as it’s not just this quarter’s GDP figure that is being recalculated: all the data, going back to 1929, is getting updated.

So while the overall size of the economy will appear bigger, there will not be a significant change in the growth rate.

“What [GDP revisions] probably won’t do is change our picture of the momentum in the economy – these changes probably aren’t going to have a big effect on that,” says Lewis Alexander, chief US economist at Nomura and a former adviser to US Treasury Secretary Timothy Geithner.

But Mr Landefeld of the BEA does think that by acknowledging the role that research and development plays in economic production, the numbers could help organisations, such the US government, in better estimating the impact of funding choices on areas such as the National Science Foundation in the future.

“A large range of public and private decision-making will be affected by this and informed by this,” says Mr Landefeld.

generic prescription pills and capsules
Drug patents will now be included in the GDP calculations
How does this compare with the way GDP is calculated in other countries?

Part of the reason for the change in calculations has to do with a co-ordinated effort among the world’s biggest economies to standardise the way their economic output is calculated. The approach came out of what is known as the System of National Accounts, which happened in 2008.

Already, Australia and Canada have started implementing similar changes, and the European Union and the UK are set to follow suit.

“As the world becomes more and more global, it’s just harder to track down these production relationships,” says Mr Moulton.

“You hear about production taking place all around the world and it’s really hard to sometimes take that global production process and figure out how much can be attributed to a particular economy.”

The hope is that by better co-ordinating measurements, a clearer picture of both global economic growth can be created, as well as more accurate data that can help world leaders better co-ordinate policy._68569550_68569368



  1. Suffer from kidney disease? aussie naturopath tells all – how his patients avoid dialysis

  2. groupage says:

    After study a few of the websites on your web site now, i truly like your way of running a blog. I book marked it to be able to my take a note of website record and will be examining back soon. Pls have a look at my site as well and also let me know how you feel.

  3. Typically the designer website must advise you connected delivery times
    connected with your purchase. Chloe also designs some sort of retro set attached to
    sunglasses with a bit of eyebrow intensity, often the Chloe 2180.

  4. alexander says:

    Excellent read, I simply passed this specific onto the colleague who had previously been doing a tiny research with that. And he actually bought me personally lunch because I found it pertaining to him smile So permit me to rephrase that.

  5. SB Dunk invariably makes use premium leather, that hard to attain by
    fakes. Newbalance: its style ‘s anti-Puma and anti-Nike. The famous host oprah says: “It’s our next best job to being barefoot.
    Within style of all Jordans Sale normally a one of gold and rich
    purples. http://misskorea.mpluskorea.com/?document_srl=397050

  6. Hello Web Admin, I noticed that your On-Page SEO is is missing a few factors, for one you do not use all three H tags in your post, also I notice that you are not using bold or italics properly in your SEO optimization. On-Page SEO means more now than ever since the new Google update: Panda. No longer are backlinks and simply pinging or sending out a RSS feed the key to getting Google PageRank or Alexa Rankings, You now NEED On-Page SEO. So what is good On-Page SEO?First your keyword must appear in the title.Then it must appear in the URL.You have to optimize your keyword and make sure that it has a nice keyword density of 3-5% in your article with relevant LSI (Latent Semantic Indexing). Then you should spread all H1,H2,H3 tags in your article.Your Keyword should appear in your first paragraph and in the last sentence of the page. You should have relevant usage of Bold and italics of your keyword.There should be one internal link to a page on your blog and you should have one image with an alt tag that has your keyword….wait there’s even more Now what if i told you there was a simple WordPress plugin that does all the On-Page SEO, and automatically for you? That’s right AUTOMATICALLY, just watch this 4minute video for more information at. Seo Plugin

  7. This is a message to the admin. Your website is missing out on at least 300 visitors per day. I have found a company which offers to dramatically increase your visitors to your website: http://nsru.net/238o They offer 1,000 free visitors during their free trial period and I managed to get over 30,000 visitors per month using their services, you could also get lot more targeted visitors than you have now. Hope this helps 🙂 Take care.

  8. Wilford says:

    Definitely one person may hope a coffee maker which uses a
    particular brand of coffee and additionally dispenses
    definitely one cup at just the time, while another might
    choose a coffee maker that can possibly make a cooking pot large enough for
    a whole gathering. we love my personal bialetti espresso maker and know it possibly makes the better coffee of the many many alternatives an estimated and also today
    we produce relocated into my personal brand-new home
    containing the gas cooker we am supposed to make the hard work to choose it more frequently.

  9. This past season glitters shoes from Celine graced the runway.

    Really are a few big and structure purses as extremely well as small shopping bags and clutches.
    There’s a logo within leading and pleated precisely
    this tote. Crew, Nine West, Banana Republic, Mia,
    Celine and Gucci all make great, classic styles. http://glosoft.co.kr/xe/?document_srl=15098

  10. Cierra says:

    Regardless you retain your own coffee maker out
    regarding the counter or retained separated within the cabinet, remember to place it in someplace
    in which it should be separated from nutrients splatters or in
    continued contact with hands. we love my personal bialetti coffee maker
    and know it probably renders the better coffee of the many another
    alternatives an estimated and additionally nowadays we need relocated at
    my personal brand new house that has the fuel cooker im going
    which will make the undertaking to make use of it a lot more usually.

  11. my website says:

    Brown’s Opening Salvo – Neil Bush’s problems mushroomed just as the Democrats decided to
    look around the offensive my website that’s the one method you will
    know whether you’ll be able to depend about the company or
    perhaps not.

  12. Depending on hemline and all material, they always be a bit of a both.
    Coupled with a superb pair of heel bone shoes this undoubtedly look amazing.
    Sheath dress is how the trendiest as definitely as great style for petite up and coming brides.
    The color or pattern belonging to the dress’s material matter a lot.

  13. I leave a comment each time I especially enjoy a post on a site or I have
    something to contribute to the discussion. It’s caused by the sincerness communicated in the article I looked at.
    And on this post How the US economy is being recalculated | Global economy & finance journal.
    I was actually moved enough to drop a thought 🙂 I do have 2 questions for you if
    it’s okay. Could it be simply me or do a few of these responses come
    across like they are left by brain dead folks? 😛 And, if you are writing at other
    sites, I would like to keep up with you. Would you make a list all of all your public pages like your twitter
    feed, Facebook page or linkedin profile?

  14. should you decide can observe the processed crusty or film
    build up stuck in order to your teas pot or perhaps your
    very own coffee maker you will hope to repeat the procedure a few times
    to make sure that they build up tend to be completely
    removed. To get more than 41 many years, you have been focused on bringing exceptional coffee and additionally
    espresso beverages in order to the consumers, says Howard Schultz, Starbucks chairman, ceo and additionally CEO, as part of a press launch.

  15. Swen says:

    It was not till 1818 wich the quite variation of
    the coffee percolator was introduced and additionally
    not up until 1835 and further which some means oof coffee maker began to bbecome enhanced known and also
    actively used. I’d be extremely surprised when you can
    notice this Western fold fast – Drip 10-mug coffee maker for sale anywhere, but
    you might be ready in order to find an utilized one online, possibly on craigslist, e – Bay, or Bid –

  16. Brewing that ideal cup of coffee as part of the home drip coffee maker is definitely not that difficult, provided you have got the
    ideal equipment, tthe right water, right filter, and additionally a top quality freshly roasted coffee.
    you may get about this particular a partners of means firstly generally ther is the possibility in order
    to dilute the coffee with drinking water otherwise next if at all like
    me your fid coffee just a little besides strong you are able to
    make it the Spanish method.

  17. escort girls says:

    Howdy! Do you use Twitter? I’d like to follow you if that would be ok.
    I’m undoubtedly enjoying your blog and look forward to new updates.

  18. Die anschlieende wird zusammen mit einem Nylon Oberteil Residenz Leder-basierte gemacht.
    The Zoom Air units do not have money to buy early warning command and control
    aircraft. Thus, having been so distinguished
    a fan of the Nike maillot air jordan pas cherv JR
    have taken an unofficial formulaic approach of tonal colorways attributed to the teams that Ken Griffey Jr.
    Here, you can be debt-free in less than 2 years.

  19. The gentle colour of now this fabric was a new status
    symbol. Your dress has the whole skirt and frills, flowers,
    ribbons, rounds and lace. Handmade cocktail Victoria Beckham Dresses can be
    worn by those of all age range. The fashion of dressing can determine the professional environment of a workplace.


  20. Usually the most important work of a Tv is as your means of communicating.
    The old saying linked with ou get utilising pay for?is undeniable with a Haemmer watch.

  21. Homepage says:

    … [Trackback]

    […] Read More: kackerwords.wordpress.com/2013/08/05/how-the-us-economy-is-being-recalculated/ […]

  22. Hello I am so thrilled I found your web site, I really found you by error, while I was
    searching on Bing for something else, Nonetheless I am here now and
    would just like to say kudos for a marvelous post and a all round exciting blog
    (I also love the theme/design), I don’t have time to look over it all at the moment but I have
    bookmarked it and also included your RSS feeds, so when I have time I will be back to read a lot more, Please do keep up the fantastic

  23. loudbounce says:

    … [Trackback]

    […] Informations on that Topic: kackerwords.wordpress.com/2013/08/05/how-the-us-economy-is-being-recalculated/ […]

  24. … [Trackback]

    […] There you will find 36445 more Infos: kackerwords.wordpress.com/2013/08/05/how-the-us-economy-is-being-recalculated/ […]

  25. … [Trackback]

    […] Read More here: kackerwords.wordpress.com/2013/08/05/how-the-us-economy-is-being-recalculated/ […]

  26. Jina says:

    For unmarried utilize, you may pick in order to buy the coffee maker that will most likely pour coffee
    one cup at a time, whilee keeping the coffere maker filled with coffee,
    and also retaining the newness until the very previous mug.
    Precisely what is the best consume of coffee with
    no the appropriate coffee maker? After you take tthe work to pick out the best
    high quality of coffee beans, fiind your oown favorite roast, annd locate the
    most wnderful mixes, you need to find the coffee maker which will .

  27. Pour much drinkingg water since you want inside
    the reservoir toward the back (retaining in your mind
    to make a the highest possible of 10 cups of coffee), invest a filter (or perhaps two, provided they are
    really sloim ffilter systems) containing ground
    coffee inside the filter basket above the pot. whenever residing in The
    country of spain we have inside drinking coffee using a strong stove coffee
    maker as these was aall anyone ever familia with render coffee aand so when I returned in order to the UK I bought me any.

  28. … [Trackback]

    […] Find More Informations here: kackerwords.wordpress.com/2013/08/05/how-the-us-economy-is-being-recalculated/ […]

  29. … [Trackback]

    […] There you will find 32484 more Infos: kackerwords.wordpress.com/2013/08/05/how-the-us-economy-is-being-recalculated/ […]

  30. DerNext Lösung finden modische Strumpfwaren ist genauin safür SeideStrümpfe.
    dies könnte eher ein ziemlich bekawnntemode put on in Asien, diese Tage
    wennder historische Vergangenheitvon von Salwar Kameez bis Spaghetti-träger -Oberteile jackenartiges Zeitin Jahfe
    zurück. Lacoste bilig diee größere willkommen die Wäsche, die mehr ihre Kinhder werden auf jeden Fall Erfahrungund freuen.
    werden siee schöne miit Bild so lange wie Sie fühlen sichgute innen.

  31. … [Trackback]

    […] Read More: kackerwords.wordpress.com/2013/08/05/how-the-us-economy-is-being-recalculated/ […]

  32. Form, ist ein vesrsierter eventvon all dasist beliebte inn die Gesellschaft
    an moment. Entwicklung, Mai nur die Emblem in unsere Lage Information und life Ralph Laren polo Ihaben
    a derBlasse Metall Gelenk in seiner zurück Haushalt.
    Sie können über Asiatischen Bekleidun auf nur ganz wirtschaftliche Preise.

    finden Siie ideal Kleid zur Verfügung diie Tatsache,
    dass Damen Mai wurden ihr Kostüm.

  33. … [Trackback]

    […] There you will find 40436 more Infos: kackerwords.wordpress.com/2013/08/05/how-the-us-economy-is-being-recalculated/ […]

  34. … [Trackback]

    […] Find More Informations here: kackerwords.wordpress.com/2013/08/05/how-the-us-economy-is-being-recalculated/ […]

  35. … [Trackback]

    […] Find More Informations here: kackerwords.wordpress.com/2013/08/05/how-the-us-economy-is-being-recalculated/ […]

  36. this page says:

    … [Trackback]

    […] Read More here: kackerwords.wordpress.com/2013/08/05/how-the-us-economy-is-being-recalculated/ […]

  37. … [Trackback]

    […] There you will find 5298 more Infos: kackerwords.wordpress.com/2013/08/05/how-the-us-economy-is-being-recalculated/ […]

  38. List of beneficial options to discover more about women before you’re left behind.

  39. Good day! I could have sworn I’ve visited this site before but after going through a few of the articles I realized it’s new to me. Anyways, I’m certainly delighted I found it and I’ll be book-marking it and checking back frequently!

  40. The companies Often Laugh at the japan – But This Time I laugh at all of them

  41. The thing you should do to discover more about watch well before you are left behind.

  42. bag At some point got You All the way down? We Offer The Perfect Solution

  43. It is possible You Also Make These Mistakes With bag ?

  44. japan assists every one of us by simply integrating quite a few distinctive capabilities and features. It’s a unvaluable item for all enthusiast of japan.

  45. Sick of every men trends? I’m on this site for you

  46. Break the habit of Complaining And Begin your own men Marketing campaign In exchange

  47. Greatest strategy for men that you may understand right away.

  48. Industry News : women Thought of as Absolutely Essential In these modern times

  49. Mack says:

    Hello, I enjoy reading through your article. I wanted to write a
    little comment to support you.

  50. Hi to every one, the contents existing at this website are genuinely amazing for people experience, well, keep up the nice
    work fellows.

  51. Heya i’m for the primary time here. I found this board and I in finding It
    truly helpful & it helped me out a lot. I am hoping to
    present something back and aid others like you helped me.

  52. Heya! I just wanted to ask if you ever have any issues with hackers?
    My last blog (wordpress) was hacked and I ended up losing
    months of hard work due to no backup. Do you have any solutions to protect against hackers?

  53. hina says:


  54. Have you been going to Delhi to the end of the week or are you currently a
    Delhi local just buying a completely new and exciting knowledge?
    Well then this site is the appropriate destination to end
    up being seeing that our Delhi escorts are the people in the business to fulfill all of
    your current requires. Using our appropriately made web site
    it is possible to browse through all our females.
    Just about every girl’s user profile is filled with
    enough details to give you advisable of exactly who she’s, while
    simultaneously departing ample on the creativity that’s a part of why
    is some sort of night out out and about with certainly one of
    the escorts the particular sophisticated experience
    it’s got become. You can’t merely review every one of the young ladies to discover more about their persona
    yet each profile features quite a few pictures to browse by way of,
    these people professionally taken. Almost nothing less than the most beneficial the following for
    our ladies. So in case you’re looking for which exclusive associate to be able to investigate the well known Sin city with, next
    the escorts with http: //zuhi.in include the kinds to do this along with.

  55. vicodin says:

    Its not my first time to pay a visit thiis web page, i am
    browsing this website dailly and obtain fastidious information from here daily.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s

%d bloggers like this: