How does big data affect GDP? theory and evidence for the UK

How does big data affect GDP? theory and evidence for the UK
Document type
Discussion paper
Author(s)
Goodridge, Peter; Haskel, Jonathan
Publisher
Imperial College Business School
Date of publication
1 July 2015
Series
Discussion Paper 2015/06
Subject(s)
Trends: economic, social and technology trends affecting business
Collection
Business and management
Material type
Reports

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This paper sets out, and implements using UK data, a conceptual framework for measuring economic activity in and around ‘Big Data’, or more broadly, data and data analytics. The primary aim is to measure how Big Data has affected GDP and productivity growth and might affect it in the future.

Using new estimates of employment and investment in Big Data and treating transformed data and data-based knowledge as capital assets, the authors estimate that for the UK: (a) in 2012, “Big Data” assets add £1.6bn to market sector GVA; (b) in 2005-2012, account for 0.02% of growth in market sector value-added; (c) much Big Data activity is already captured in the official data on software – 76% of investment in Big Data is already included in official software investment, and 76% of the contribution of Big Data to GDP growth is also already in the software contribution; and (d) in the coming decade, data-based assets may contribute around 0.07% to 0.23% pa of annual growth on average.

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