GDP Is Dead. What’s Next?
Stick a fork in the GDP. Much in our world depends on the Gross Domestic Product — the central yardstick by which we gauge whether a nation’s economy is growing or shrinking, healthy or ailing. But GDP is flawed and outdated, and now governments and economists are trying to figure out how to replace it (Bloomberg). The problems with GDP are legion: it misses key changes in income equality, technological change and living standards. It has a hard time capturing the impact of economic activity once it moves online. The GDP numbers that get headlines on initial release are almost always wrong and end up being substantially revised. If this was how you were measuring your family’s or business’s economic well-being, you’d want to replace it, fast. The trouble is, if you threw GDP out the window tomorrow, economists don’t seem to have many ideas of what you could use instead. Fortunately, this is precisely the kind of problem that so many other strong trends today — from deep-learning AI systems to networked sensors to digital cash — ought to help us solve in the long term. For now, when it comes to macroeconomics, we’d better get good at flying blind.
The elusive formula for a downtown renaissance. Some aging Rust Belt cities manage to reinvent themselves as welcoming turf for NewCos, and others don’t. Success “requires more than a good coffeehouse” (Toledo Blade). Toledo, Ohio launched a campaign a decade ago to retain and attract college-educated workers and new small businesses. With new museums and other amenities and a reasonable cost of living, the city has made some progress. But holding on to talented locals drawn by other towns and regions remains a struggle. Cities like Toledo still need to reverse a reputational deficit years in in the making; people need to know that they have, not only good coffee, but jobs, and downtowns that are no longer “dumps.”
Tech titans rule the stock markets. Yesterday we read about the obsolescence of the “technology industry” label. But “tech” remains the name of an economic sector —and it’s totally dominating the equity markets right now (Bloomberg). Not since the crazy days of the dotcom bubble in 2000 have tech stocks owned such a large share of the S&P 500: 21 percent. Led by surging giants like Alphabet/Google, Facebook, and Amazon, Big Tech is bigger than ever. But unlike at the dotcom-era high, today’s tech leaders are actually generating profits in line with their share of the stock index. Far from bubble territory, we’re more likely seeing market numbers that are finally catching up with digital realities.
Androids don’t lose sleep over the trolley problem. We’ve talked in the past about the “trolley problem” — the thought experiment that puts you in the moral hot seat, forcing a choice between killing one innocent person (by flipping a track switch) or doing nothing and letting a whole bunch of innocent people die. Sucks to be that person! In the age of the self-driving car, the trolley problem has gone viral; it encapsulates the kinds of dilemmas we imagine autonomous vehicles will have to navigate. So here’s some good news (via The Guardian): The people actually building those vehicles say such quandaries never come up in practice. The trolley problem is, in engineers’ lingo, an extreme edge case. “We have never been in a situation where you have to pick between the baby stroller or the grandmother,” one Google X engineer explains — and if it ever does come up, “The answer is almost always ‘slam on the brakes.’ ”
How to tame videoconferencing’s merciless eye. Narcissus saw his reflection in water and froze. Apparently the same thing is happening to many of us when we see our images reflected in the harsh lens of the videoconferencing call (Quartz). Instead of focusing on what our colleagues are saying, we stare, transfixed in horror, at the pallor of our own skin or the tired bags under our eyes. Designers are trying to strike back at this “appearance barrier” by designing conference rooms to be friendlier sets and by teaching participants to adjust camera height, finesse the lighting, and look straight at the video lens to make eye contact. Maybe all that practice with selfies will come in handy, too.
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