Can Big Data be Used to Track Economic Growth?

Big Data

The Office of National Statistics announced that there may yet be methods to measure economic progress like big data, machine learning, and monitoring online activity / Photo by: Diliff via Wikimedia Commons

 

The Office of National Statistics (ONS) has announced that there may yet be methods upon which economic progress can be measured, and this is through the help of big data, machine learning, and monitoring online activity.

The Guardian reports that the government has already been testing this theory by starting off with “monitoring the number of lorries on roads and company VAT receipts, in an attempt to more rapidly spot changes taking place in the UK economy.”

No matter that the effort sounds like a good idea, but it was actually heavily criticized. For instance, these efforts have amassed “sharp criticism” ever since 2008, so why does the ONS still take a chance on it?

For one thing, the effort of monitoring 2019 VAT receipts did find out that the “very slight” downturn turned out to be true. Unfortunately, the road traffic and the large vehicle counter during this time should be proportionate to the slight downturn as reported, but instead, the number of larger vehicles were the same as they were in 2016 and 2018.

In the past, some European countries have also tried to develop methods, not unlike this one, with the Netherlands and their monitoring of both road traffic data and shipping. Chinese Premier Li Keqiang was also one of those who devised methods like this as The Guardian reports that he would use “electricity consumption, railway freight, and bank lending data to assess growth in China.”

That, at least, proved useful, considering Li Keqiang eventually got an index based on the mentioned metrics named after him. Compared to the as-yet-vague usefulness of the ONS’ system, the Chinese method had worked wonders.

Many have tried to gauge certain aspects of society through the use of big data, but when it comes to the economy, the only big data that well and truly (so far) manages to tell us about our economy is our waste. “When more goods are bought, more waste is created,” said The Guardian.