The Digital Welfare of Nations: New Measures of Welfare Gains and Inequality

Erik Brynjolfsson, Avinash Collis, Asad Liaqat, Daley Kutzman, Haritz Garro, Daniel Deisenroth, Nils Wernerfelt and Jae Joon Lee
Additional contact information
Avinash Collis: Carnegie Mellon U
Asad Liaqat: Meta, Menlo Park
Daley Kutzman: Meta, Menlo Park
Haritz Garro: Meta, Menlo Park
Daniel Deisenroth: Meta, Menlo Park
Nils Wernerfelt: Northwestern U
Jae Joon Lee: Stanford U

Research Papers from Stanford University, Graduate School of Business

Abstract: Digital goods can generate large benefits for consumers, but these benefits are largely unmeasured in the national accounts, including GDP and productivity. In this paper, we measure welfare gains from 10 popular digital goods across 13 countries by conducting large-scale incentivized online choice experiments on representative samples of nearly 40,000 people. We estimate that these goods--many of which are free to users--generate over $2.5 trillion in aggregate consumer welfare across these countries per year, which is roughly equivalent to 6% of their combined GDP. We find that lower-income individuals and lower-income countries obtain relatively larger welfare gains from these goods compared to higher-income individuals and countries. This suggests that digital goods may reduce inequality in welfare within and across countries by disproportionately benefiting lower-income groups.

JEL-codes: O30 O4 (search for similar items in EconPapers)
Date: 2023-09
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Working Paper: The Digital Welfare of Nations: New Measures of Welfare Gains and Inequality (2023)
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Persistent link: https://EconPapers.repec.org/RePEc:ecl:stabus:4144

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