The U.S. federal government is changing how it calculates the company’s gross domestic product or GDP. For the first time, the Bureau of Economic Analysis will include expenditures for “R&D and for entertainment, literary and artistic originals as fixed investment.” The new expenditures will be added to the list of intellectual-property investments.
As explained in a recent Wall Street Journal article, including the money Lady Gaga spent writing and recording an album in the GDP represents a significant change. The same goes for adding the time and money it takes to develop the latest smart phone device.
It not only reveals that the U.S. economy is approximately 3 percent larger, but it also “reflects the economy’s quiet transformation from one based principally on industry to one decidedly based on knowledge and information.” The new GDP measure further solidifies the role of innovation and intellectual property (IP) in driving the economy.
As previously discussed here, the U.S. Patent and Trademark Office estimates that IP-intensive industries directly accounted for 27.1 million American jobs, or 18.8 percent of all employment in the economy, in 2010. The industries also accounted for about $5.06 trillion in value added, or 34.8 percent of U.S. gross domestic product (GDP), in 2010.
It makes sense that the Bureau of Economic Analysis would want to fully capture the contributions of IP.
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