Should U.S. GDP count ‘The Bachelorette’?

Gigi Douban Jul 31, 2013
HTML EMBED:
COPY

Should U.S. GDP count ‘The Bachelorette’?

Gigi Douban Jul 31, 2013
HTML EMBED:
COPY

Update, 10 a.m., July 31: The government is reporting GDP grew at a rate of 1.7 percent from April to June, beating analyst expectations.

Original story: The Commerce Department revises the items it includes in its Gross Domestic Product estimates on Wednesday. From now on, things like research and development, books and box office hits are going to count in our overall economic picture.

Say what you will about the show “South Park”, but as a long-running series, it’s a vital part of our future economic growth. Just ask Alexander Field, an economic historian at Santa Clara University.

“Creating a blockbuster film or television show that will continue to earn royalties or go into syndication in the future is a valuable asset to our economy,” Field says.

Another big change? Research and development — say, when a business invests in a new drug or computer technology — will now count toward GDP. That’s a good thing, says Melissa Thomasson, who teaches economics at Miami University.

“Research and development are things that hopefully make us more productive in the long run,” she says. But she doesn’t think the bump in GDP from adding entertainment is as valuable, “especially to the extent that we’re measuring royalties on something that’s already going on,” she says.

The U.S. Bureau of Economic Analysis says it’ll get some of that information from trade sources, and it will extrapolate some of the rest, going all the way back to 1929. 

We’re here to help you navigate this changed world and economy.

Our mission at Marketplace is to raise the economic intelligence of the country. It’s a tough task, but it’s never been more important.

In the past year, we’ve seen record unemployment, stimulus bills, and reddit users influencing the stock market. Marketplace helps you understand it all, will fact-based, approachable, and unbiased reporting.

Generous support from listeners and readers is what powers our nonprofit news—and your donation today will help provide this essential service. For just $5/month, you can sustain independent journalism that keeps you and thousands of others informed.