The Tech Productivity Mystery - Bloomberg View
They note that it's very difficult to measure the quality of IT products. If quality increases while prices and sales stay the same, productivity has gone up, but official statistics won't record the increase. There is also the problem that innovation in IT regularly produces new kinds of products, which people use to replace old kinds of products. When this happens, the overall cost of living goes down -- for example, if people read free social media instead of watching TV for their entertainment. But economists measure inflation by measuring changes in prices for the same goods, so they will miss this kind of change, and end up overstating inflation -- which understates productivity.
If you believe that the official price statistics give an accurate measure of the cost of IT, then you should be worried about a slowdown in the sectors. But if you think that the unique nature of IT makes price statistics unreliable, then you shouldn't be worried.
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