Lopsided Innovation Causes Productivity Slowdowns
Bottlenecks can form when industries innovate at different paces.
Lopsided Innovation Causes Productivity SlowdownsE-commerce’s share of spending has tripled in the past decade. That has implications for many individual companies, both new and old, but it’s also relevant to something broader: price inflation. By constructing a Digital Price Index that approximates the US Bureau of Labor Statistics’ Consumer Price Index, Chicago Booth’s Austan D. Goolsbee and Stanford’s Peter J. Klenow find that inflation is lower online than it is in brick-and-mortar stores—a full percentage point per year lower from 2014–2017, and three percentage points per year lower when new products are factored in. The researchers suggest that this disparity, coupled with continued growth for e-commerce, could influence overall inflation levels in the economy and change how inflation is measured.
Bottlenecks can form when industries innovate at different paces.
Lopsided Innovation Causes Productivity SlowdownsResearchers piece together an explanation for the decline in US antitrust enforcement in recent decades.
What Made the Chicago School So Influential in Antitrust Policy?The depletion of the funds points to bigger fiscal issues.
Should We Worry That the Social Security Trust Funds Are Going Bust?Your Privacy
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