Where’s the $3 trillion?

WASHINGTON,DC: Is the American economy stronger than we think? Perhaps. A persisting puzzle about its recent performance is the stark contrast between growth of jobs (which has been unexpectedly robust) and the growth of the economy’s output (which has been unexpectedly weak). How could a struggling economy produce so many jobs?  The puzzle would disappear if the economy’s output is consistently undercounted.

And it is, say critics. Government statistics miss many gains from the Internet, they argue, because some “free” services such as Facebook, Google and Twitter aren’t counted directly in the economy’s output, gross domestic product (GDP). This seems to defy common sense, considering the widespread use of these services. (At last count, Facebook had 1.6 billion users worldwide and Twitter had 320 million.) Other economists deny the undercounting argument.