Technology, GDP, and human welfare

In a post from December 2015, I wrote that technology produces a consumer surplus which, although it isn’t captured in GDP, is a very important part of human welfare. The examples I drew on in that post were from an Economist article which focused specifically on the consumer surplus created by the internet.

However, the internet is just one form of technology. Other technologies, like smartphones, have a similar impact on consumer surplus which isn’t captured in GDP.

Here’s a September 2016 presentation by Hal Varian from the University of California at Berkeley which gives several examples of the consumer surplus generated by smartphones. Towards the end of the presentation, Hal also shows how the global supply chain is another factor which confounds GDP measurements.

Originally published at Thoughts of a VC.