by Oliver Hartwich
I don’t know about you but I like economists’ jokes. Here is one of my favourites:
A man finds himself lost in fog while flying a hot air balloon. He decides to lower the balloon to ask a passerby for directions. As he gets close enough to the ground, he calls out to a pedestrian, “Excuse me, can you tell me where I am?”
The passerby looks up and replies, “Certainly. You are in a balloon.”
The balloonist is taken aback for a moment, but then he responds, “You must be an economist.” The passerby, with a slight smile, confirms, “Yes, indeed, I am. How did you know?” The balloonist explains, “Because your answer is technically correct, but not helpful.”
Now, that is all very funny, of course. Except, the joke goes on:
The conversation continues with the passerby retorting, “And you must be a businessman.” The balloonist, curious, admits, “Why, yes, I am. How did you know?” The economist passerby points out, “Because you have a great view from where you are, yet you do not know where you are.”
Well, ha-ha, I suppose.
But the truth is, this joke actually isn’t a laughing matter. Because, like with most jokes, there is some truth to it.
Economists can be technically correct yet unhelpful, and businesspeople may indeed miss the wood for the trees at times.
However, there is hope, and that hope comes in the form of GDPLive. It is an economics project, yet it is helpful. And it is created out of business data, but it tells us precisely where we are.
In fact, GDPLive marks a turning point in New Zealand’s economic forecasting. In addition to providing reliable data, like the economist in our joke, this awesome tool offers practical, actionable insights for policymakers, businesses, and investors.
With its machine learning algorithms, GDPLive sifts through massive amounts of daily transaction data collected from New Zealand companies on the cusp of modern technology.
The real-time analysis of data dispenses with traditional quarterly GDP reports, which are often lagging the rapidly evolving economic landscape.
Indeed, the brilliance of GDPLive lies in its timeliness. With economic conditions changing at a moment’s notice, GDPLive is more than a game-changer.
It provides a current snapshot of the economy, allowing for an agile response to economic trends and challenges. For policymakers who are tasked with steering the economic ship amidst turbulent waters, this timeliness is of particular importance.
A significant advantage of GDPLive is the frequency with which it can update data, which is significantly higher than traditional forecasting methods. Having daily GDP live-casts can enhance government fiscal policy as well as business operation adjustments significantly.
Its ability to break down GDP forecasts by region and sector provides an in-depth understanding that is vital for targeted decision-making. In addition to providing a more effective economic policy and business strategy, granularity allows resources to be allocated where they are most needed.
GDPLive may very well be heralding a new era of economic forecasting. It shows how the amalgamation of artificial intelligence, big data, and a deep understanding of economics can radically enhance the accuracy and timeliness of economic data.
Through GDPLive, we are not merely in a balloon enjoying the view; we are navigating through the fog with a reliable, precise compass, ready to face the economic challenges and opportunities that lie ahead.
And that is no joke.
Dr Oliver Hartwich is the Executive Director of The New Zealand Initiative (www.nzinitiative.org.nz).
