Working Paper: Defining and Measuring the Digital Economy

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Defining and Measuring the Digital Economy

WorkingPaper

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KevinBarefoot,DaveCurtis,WilliamJolliff,JessicaR.Nicholson,RobertOmohundro

3/15/2018

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THISPAGEINTENTIONALLY LEFTBLANK

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Abstract

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Thispaper,madepossiblebysupportfromtheCommerceDepartment’sNationalTelecommunications

andInformationAdministration(NTIA),describestheworkoftheBureauofEconomicAnalysis(BEA)to

developestimatestowardstheconstructionofanewdigitaleconomysatelliteaccount.Theseestimates

arethefirststeptoacomprehensivemeasureofthe

contributionofthedigitaleconomytogross

domesticproduct(GDP).BEA’sGDPstatisticsincludeeconomicactivityassociatedwiththedigital

economy,buttheydonotallowdatauserstoseparatelyidentifythecontributionofthedigitalecono my 

toeconomicgrowth.Thesenewestimates complementtheofficialstatisticsbyprovidinga

targeted

pictureoftheroleofthedigitaleconomyintheoverallU.S.economy.

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BEAconstructedtheestimatespresentedinthispaperwithinasupply‐useframeworkfollowingathree‐

stepprocess.First,BEAdevelopedaconceptualdefinitionofthedigitaleconomy.Second,BEA

identifiedspecificgoodsandservicescategorieswithin

BEA’ssupply‐useframeworkrelevantto

measuringthedigitaleconomy.Third,BEAusedthesupply‐usefr ameworktoidentifytheindustries

responsibleforproducingthesegoodsandservices,andestimatedoutput,valueadded,employment,

compensation,andothervariablesfortheseindustries.

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ThisreportpresentsBEA’sinitialworktolaythe

foundationforadigitaleconomysatelliteaccount.

Conceptually,adigitaleconomysatelliteaccountshouldincludeallgoodsandservicesrelatedtothe

digitaleconomy.However,thepreliminaryestimatespresentedherearebasedongoodsandservices

thatareprimarilydigital.Therearenumerouschallengestoestimating theeconomiccontributionof

“partially‐digital”goodsandserviceswhicharelaidoutinthisreport.Thesechallengesareopportunities

forfutureresearchtoexpandtheseearlyestimatesintoacompletedigitaleconomysatelliteaccount.

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From2006to2016,BEAestimatesthatdigitaleconomyrealvalueaddedgrewatanaverageannualrate

of5.6

percent,outpacingtheaverageannualrateofgrowthfortheoveralleconomyof1.5percent.In 

2016,thedigitaleconomywasanotablecontributortotheoveralleconomy—itaccountedfor6.5

percentofcurrent‐dollarGDP,6.2percentofcurrent‐dollargrossoutput,3.9percentofemployment,

and6.7percent

ofemployeecompensation.

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Authorinformation:

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KevinBarefoot

DaveCurtis

WilliamJolliff

JessicaR.Nicholson

RobertOmohundro

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[email protected]

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Thisdocumentisaworkingpaperandsharesprelim inaryknowledgeandstatistics.Thegoalofthe

paperistoelicitfeedback.Theviewsexpressedinthis presentationarethoseoftheauthorsanddonot

necessarilyreflecttheopinionsofBEAorNTIA.

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Introduction

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Withtherapidgrowthoftheinternetstartinginthemid‐1990s,thedigitallandscapehasexpande d and

changedhowbusinessesoperateandhowconsumersengageintransactionswithbusinessesandwith

eachother.Computersarenowubiquitousandtheeconomyreliesondigitalandinternettechnologies

inwaysthatpeople

couldnothaveanticipatedevenafewyearsago.TheNationalTelecommunications

andInformationAdministration(NTIA)reportsthat75percentofAmericansreportedusingtheinternet

in2015comparedwithonly44percentin2000.

Thesetechnologiescontin uetochangehowpeople

work,communicate,purchasegoodsandservices,andperformeverydaytasks.Thereislittledoubtas

totheimportanceofdigitaltechnologyinAmericanbusinessanditsroleinfosteringnationaleconomic

growthandcompetitiveness.Measuringtheimpactofthedigitaleconomyisessential

for

understandingtheoveralleconomygiventheincreasingrelianceofbusinessesandconsumersondigital

productsandservices.

Studyingtheimpactofdigitizationontheeconomyisnotanewidea.TheBureauofEconomicAnalysis

(BEA),otheragenciesintheDepartmentofCommerce,andotherorganizationshavebeenresearching

and

publishingreportsmeasuringtheimpactofthe“digitaleconomy,”the“interneteconomy,”orthe

“neweconomy”fornearlytwodecades.TheEconomicsandStatisticsAdministrationhasreportson

measuringtheemergingdigitaleconomyasfarbackas1998.In2001,theU.S.CensusBureauissueda

reportcitingthesame

rationaleusedbyadvocatesofdigitaleconomymeasurementtoday.In2016,the

U.S.DepartmentofCommerceformedtheinauguralDigitalEconomyBoardofAdvisors(DEBA)madeup

ofdistinguishedleadersfromindustryandacademia.TheDEBAmembersbringawiderangeof

experienceandknowledgeonthedigitaleconomyandhow

itrelatestobusinessesandeconomicpolicy.

Intheirfirstreport,theDEBArecommendeddevelopingmeasuresoftheimpactofdigitizationon

economicindicatorssuchasGDPandproductivity,aswellastheextentofdigitizationacrossvarious

sectorsoftheeconomy.

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ThisreportoffersBEA’sfirstdigitaleconomyestimateswithintheframeworkofthenationalaccounts.

Thesenewstatisticsprovideadeeperunderstanding ofthesizeandeconomicimportanceofthedigital

economysothatpolicymakers,businesses,andotherstakeholderscanmakeinformeddecisions.They

identifyandhighlightdigitalactivitiesthatare

currentlyembeddedinBEA’sgr ossdomesticproduct

statistics.Thedatacanbeusedbybusinesses,researchersandothers.Thisreportrepresentsan

importantsteptowardBEA’sdevelopmentofadigitaleconomysatelliteaccount.

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BEA’sinitialestimatesshowthatthedigitaleconomyhasbeenabrightspotintheU.S.economy,

growingatanaverageannualrateof5.6percentperyearfrom2006to2016comparedto1.5percent

growthintheoveralleconomy.Thedigitaleconomyaccountedfor6.5percent($1,209.2billion)of

current‐dollarGDP($18,624.5billion)in2016.WhencomparedwithtraditionalU.S.industriesor

sectors,thedigital

economyrankedjustbelowprofessional,scientific,andtechnicalservices,which



SeetheNationalTelecommunicationsandInformationAdministration’sDigitalNationalDataExplorerat

https://www.ntia.doc.gov/data/digital‐nation‐data‐explorer#sel=internetUser&disp=map.

SeeU.S.DepartmentofCommerce.“FirstReportoftheDigitalEconomyBoardofAdvisors.”(2016)Availableat

https://www.ntia.doc.gov/files/ntia/publications/deba_first_year_report_dec_2016.pdf.

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accountedfor7.1percent($1,326.3billion) ofcurrent‐dollarGDP,andjustabovewholesaletrade,

whichaccountedfor5.9percent($1,102.6billion)ofcurrent‐dollarGDP(chart1).

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Thatsameyear,thedigitaleconomysupported5.9million jobs,whichaccountedfor3.9percentoftotal

U.S.employment(150.3million),similartoindustri eslikefinanceandinsurance,wholesaletrade,and

transportationandwarehousing(chart2).Employeesworkinginthedigitaleconomyearned$114,275

inaverageannualcompensationcomparedto

$66,498averageannualcompensationperworkerforthe

totalU.S.economy.



0% 5% 10% 15%

Agriculture,forestry,fishing,andhunting

Arts,entertainment,andrecreation

Educationalservices

Mining

Utilities

Managementofcompaniesandenterprises

Otherservices,exceptgovernment

Accommodationandfoodservices

Transportationandwarehousing

Administrativeandwastemanagementservices

Construction

Information

Retailtrade

Wholesaletrade

Digitaleconomy

Professional,scientific,andtechnicalservices

Healthcareand

socialassistance

Financeandinsurance

Manufacturing

Government

Realestateandrentalandleasing

U.S.Bureau ofEconomicAnalysis

Chart1.Digital EconomyandIndustryShareofTotalGrossDomesticProduct, 2016

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Theremainderofthisreportcomprisesthreesections.Thefirstsectiondiscussestheestimation

methodologyinmoredetail.Thesecondsectionpresentspreliminarydigitaleconomyestimates.The

reportconcludesbynotingpoten tialareasforresearchtoadvance measurementofthedigitaleconomy

towardtheconstructionofacomprehensivesatelliteaccount.



 

0% 2% 4% 6% 8% 10% 12% 14% 16% 18%

Utilities

Mining

Agriculture,forestry,fishing,andhunting

Realestateandrentalandleasing

Managementofcompaniesandenterprises

Arts,entertainment,andrecreation

Information

Educationalservices

Transportationandwarehousing

Digitaleconomy

Wholesaletrade

Financeandinsurance

Construction

Otherservices,exceptgovernment

Professional,scientific,andtechnicalservices

Administrativeandwastemanagementservices

Manufacturing

Accommodationandfoodservices

Retailtrade

Healthcareandsocialassistance

Government

U.S.Bureau ofEconomicAnalysis

Chart2.Digital EconomyandIndustryShareofTotalEmployment, 2016

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Methodology

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BEApreparedthesestatisticswithin thesupply‐useframework,followingmethodologyusedinthe

productionofotherBEAsatelliteaccounts,includingthoseontravelandtourism,artsandcultural

production,andoutdoorrecreation.



Theestimationprocessincludesthreemainsteps:

(1) Developaconceptualdefinitionofthedigitaleconomy;

(2) Identifygoodsandserviceswithinthesupply‐useframeworkrelevantformeasuringthedigital

economydefinedinthefirststep;and

(3) Usethesupply‐useframeworktoidentifytheindustriesresponsiblefor

producingthesegoods

andservices,andestimatetheoutput,valueadded,employment,compensationandother

variablesassociatedwiththisactivity



Duringthesecondstepofthisprocess,BEAreviewedthedetailedgoodsandservicescategoriesfrom

thesupply‐useframeworktoidentifythosegoodsandservicesthatarepartofthe

digitaleconomy.



Somegoodsandservicescategoriesincludeamixofbothdigitalandnon‐digitalgoodsandservices.For

example,thegoodscategoryelectronictoysandgames,includinghomevideogames(excluding

cartridges,disks,andtapes)includesbothdigitalvideogamesand non‐digitalelectronictoys.

Conceptually,measuresofthedigital

economyshouldincludedigitalvideogam es;however,duetodata

andresourceconstraints,theestimatespresentedhereinclude thegoodsandservicescategoriesthat

BEAconsidersprimarilydigital.

(1)Definethedigitaleconomy

Justastheideaofmeasuringthedigitaleconomyhasbeenaroundformanyyears,sohavethe

challengesassociatedwithitsmeasurement.Oneofthemostfundamentalchallengesis thelackofa

preciseanduniversaldefinitionthatclarifieswhichactivitiesshouldbeincludedwhenmeasuringthe

digitaleconomy.Part

ofwhatmakesdefiningthedigi tal economydifficultistherapidlychangingnature

oftechnology.Whatisrelevantonedaymightbeobsoletethenextasbusinessesandconsumersadopt

newtechnologiestoperformtasksandcommunicate.Ideally,thedefinitionofthedigitaleconomy

wouldallowforthechangingnature

ofwhatitencompassesovertime.



Inthispaper,BEAdefinesthedigitaleconomyprimarilyintermsoftheInternet andrelatedinformation

andcommunicationstechnologies(ICT).Todevelopa definition,BEAreliedonanalystexpertiseand

existingliteratureandstatisticsonthedigitaleconomy.BEA’sICTsectorservedas

astartingpointfor





Formoreinformationonthemethodologyandsatelliteaccounts,seeBEA’s“MeasuringtheNation’sEconomy:

AnIndustryPerspective.APrimeronBEA’sIndustryAccounts.”Availableat

https://www.bea.gov/industry/pdf/industry_primer.pdf.TheindustryaccountsareonecomponentoftheU.S.

economicaccountsthatprovideinformationonthevalueandcompositionofoutputproducedintheUnited

Statesandonthetypesofincomegeneratedbythatproduction.Thenationalaccountingframeworkexcludes

goodsandservicesprovidedatzerocost.

BEAclassifiesgoodsandservicesusingasystembasedontheNorthAmericanIndustrialClassificationSystem

(NAICS).



7



BEA’sdefinitionofthedigitaleconomy.

WhilenotallICTgoodsandservicesarefullyinscope,theICT

sectorandthedigitaleconomylargelyoverlap.TheestimatespresentedinthisreportincludeBEA’sICT

sectoraswellasadditionalgoodsandservicesdeterminedtobe inscopeforthedigitaleconomy.Asin

thepast

whenBEAdevelopedstatisticsontheICTsector,BEAreferencedtheOrganizationforEconomic

CooperationandDevelopment’s(OECD)digitaleconomymeasurementliterature.

BEAincludesinits

definition(1)thedigital‐enablinginfrastructureneededforacomputernetworktoexistandoperate,(2)

thedigitaltransactionsthattakeplaceusingthatsystem(“e‐commerce”),and(3)thecontentthat 

digitaleconomyuserscreateandaccess(“digitalmedia”).





Digital‐enablinginfrastructure

Computernetworks,suchastheinternet,arethefoundationofthedigitaleconomy.Digital‐enabling

infrastructureiscomprisedofthebasicphysical materialsandorganizationalarrangementsthatsupport

theexistenceanduseofcomputernetworksandthedigitaleconomy,theseinclude:





Computerhardware:Themanufacturedphysicalelementsthatconstituteacomputersystem

including,butnotlimitedto,monitors,harddrives,semiconductors,wirelesscommunications

products,andaudioandvisualequipmentproducts.





Software:Theprogramsandotheroperatinginformationusedby devicessuchaspersonal

computersandcommercialservers,includingboth

commercialsoftwareandsoftware

developedin‐housebyfirmsfortheirownuse.





Telecommunicationsequipmentandservices:Theequipmentandservicesrequiredforthe

digitaltransmissionofinformationoveradistancebycable,telegraph,telephone,broadcasting,

orsatellite.





Structures:Thisincludestheconstructionofbuildingswheredigital

economyproducerscreate

digitaleconomygoodsorsupplydigitaleconomyservices.Thestructurescategoryalsoincludes

buildingsthatprovidesupportservicestodigitalproducts.Thisincl udestheconstructionofdata

centers,semiconductorfabricationplants,theinstallationsoffiberopticcables,switches,

repeaters,etc.





TheInternetofThings(IoT):Internet‐

enableddeviceslikeappliances,machinery,andcarswith

embeddedhardwareallowingthemtocommunicatewitheachotherandconnecttothe

Internet.





TheBEAICTsectorconsistsofcomputerandelectronicproductmanufacturing(excludingnavigational,

measuring,electromedical,andcontrolinstrumentsmanufacturing);softwarepublishers;broadcastingand

telecommunications;dataprocessing,hostingandrelatedservices;internetpublishingandbroadcastingandweb

searchportals;andcomputersystemsdesignandrelatedservices.BEA’sdefinitionisgenerallyconsistent

withthe

internationallyaccepteddefinitionoftheICTsectorusedanddevelopedbythestatisticalofficesoftheOECDand

UnitedNations.

ForinformationontheOECD’sdigitaleconomymeasurementwork,seehttp://www.oecd.org/sti/ieconomy/.

BEAalsoparticipatesintheOECDworkinggrouponMeasuringGDPinaDigitalizedEconomy.



8





Supportservices:Servicesnecessaryforthefunctionofdigitalinfr astructuresuchasdigital

consultingservicesandcomputerrepairservices.

E‐commerce

BEAusestheterm“e‐commerce”todescribe,broadly,allpurchasesandsalesofgoodsandservicesthat

occurovercomputernetworks.E‐commercereflectsthenatureofatransactionforgoodsorservices.

BEAconsiderse‐commercetoincludedigitally‐ordered,digitally‐delivered,orplatform‐enabled

transactions.Thesetransactionsinclude:







Business‐to‐business(B2B)e‐commerce:E‐commercethatutilizestheinternetorother

electronicmeanstoconducttransactionsofgoodsandservicesbybusinessestoother

businesses.Manufacturers,wholesalers,andotherindustriesengagein bothinterfirmand

intrafirme‐commercetoproducegoodsandservicesforfinalconsumption.







Business‐to‐consumer(B2C)e‐commerce:E‐commercethatutilizestheInternetorother

electronicmeanstoconductthesaleofgoodsandservicesbybusinessestoconsumers,orretail

e‐commerce.





Peer‐to‐peer(P2P)e‐com merce:The“sharing”eco nomy,alsoknownasplatform‐enablede

‐

commerce,involvestheexchangeofgoodsandservicesbetweenconsumersfacilitatedthrough

adigitalapplication.Theseinclude,butarenotlimitedto,ridedispatching,accommodation

rentals,deliveryandcourierservices,landscaping, foodpreparation,consumergoodsrentals,

laundryservices,andjanitorialservices.



Digitalmedia

Thethirdcomponen t ofthedigitaleconomyisdigitalmedia.In creasingly,consumersforgothephysical

purchaseorrentalofproductslike books,newspapers,music,andvideos,optinginsteadtoaccessthese

productsonlineinadigitalformat.BEAdefinesdigitalmediaasthecontentthatpeoplecreate,access,

store,orview

ondigitaldevices,specifically:





Directsaledigitalmedia:Businessesmayselldigitalproductsdirectlytoconsumersinexchange

forafee,eitheronanitem‐by‐itembasi sorthrough asubscriptionservice.





Freedigitalmedia:Somecompaniesofferdigitalmediatoconsu mersatnocost,such

as

YouTubeorFacebook.Typically,businessesofferingtheseservicesearnrevenuebyselling

advertisingspaceonthemarginsofthedigitalproduct,likethemodelfollow edbymanyprint

mediaorbroadcasttelevisionoutlets.Inaddition,someconsumerscreateoriginalonline

contentforpeerconsumption,knownasP2Pdigitalmedia.





Bigdata:Somecompaniesgeneratelargedatasets aspartoftheirnormaloperations.Thiscould

alsoincludetheuseofdigitalmediaasamechanism forgatheri nginformationaboutconsumer

behaviororpreferences.Thesecompaniesmayearnrevenuebysellingthisinformation,

sometimesreferredtoas“bigdata,”or

leveragingitinotherways.



9



(2)Identifydigitaleconomygoodsandservices

Usingthisdefinitionandtheexistingdetaileddatafromthesupply‐usetables,BEAidentifiedgoodsand

servicesforinclusionintheinitialdigitaleconomyestimates.BEAclassifiesdatainthesuppl y‐usetables

usingaNAICS‐basedframeworkthatincludesabout5,000categories ofgoodsandservices.

(SeeBox

onBEAMethodologyforEstimatingSupply‐UseTables).BEAreliedonanalystexpertiseandoutside

researchtoselectover200goodsandservicescategoriesforinclusioninthepreliminaryestimates

presentedinthisreport.

Theremainderofthissectiondiscussessomeofthedifferencesbetweenthe

goodsandservicesidentifiedintheconceptualdefinitionofthedigitaleconomyandthegoodsand

servicesBEAincludedintheinitialestimates.



Asnotedintheintroduction,someNAICS‐basedgoodsandservicescate goriesincludedigitalgoods

and

servicesaswellasnon‐digitalgoodsandservices.WhileBEA’sconceptualdefinitionofthedigital

economyincludesalldigi tal goodsandservices,BEAdidnotattempttoincludethedigitalportionof

thosegoodsandservicescategoriesthatincludebothdigitalandnon‐digitalcomponentsin the

preliminaryestimates,

choosinginsteadtofocusonlyongoodsand servicescategoriesthatare

exclusivelyorprimarilydigital.Splittingtheoutputof“partially‐digital”categorie sintodigitalandnon‐

digitalportionswillrequireadditionalsourcedataandotherreso urcestoaccuratelyidentifytheshare

ofoutputthatisinscopeforthe

digitaleconomy,aswillbediscussedinthelastsectionofthisreport.



Followingthisapproach,BEAincludedanear‐comprehensivelistofdigitaleconomyhardware,software,

supportservices,andtelecommunicationsgoodsandservicesintheinfrastructureportionofthedigital

economyestimates.BEAdidnotincludestructuresandIoTinfrastructure

intheinitialestimates

becauseofthedifficultyindeterminingtheproperallocationofthesecategoriesintodigitalandnon‐

digitalcomponents.



ForbothstructuresandIoTinfrastructure,BEAdoesnothavedataavailabletoseparatedigitaleconomy

activityfromallotheractivity.ThecaseofIoTinfrastructurepresentsadditional

challenges.For

example,theconnectivityofaninternet‐enabledrefrigeratormayallowtheownertotrackand

purchasefooditemswhentheyarerunningloworrecordusageoftheappliance.However,theprimary

functionoftherefrigeratoristokeepfoodcold,outputwhichBEAwouldnotclassifyasbeing

partofthe

digitaleconomy.



E‐commerceoutputisgen erallymeasuredasthewholesaleorretailtrademarginon“digitallyordered”

goodsandservicessoldovertheInternetorthroughsomeotherelectronicmarket.Themarginisequal

tototalrevenueearnedfromonlinesaleslesstheproducercostof

thegoodsandservices.Forthis

report,BEAincludedintheestimatesthemarginsforboth B2BwholesaleandB2Cretailtransactions

fromelectronicmarketestablishments.BEAalsoincludedsomenon‐marginoutputinthefo rmoffees

forbrokersthatconnectbuyersandsellers.BEAdidnotexplicitlyinclude

thevalueofP2Por“platform‐

enabled”transactionsbecauseofalackofdataonthevalueofthesetransactions.BEAcapturesinthe

supply‐usetablesthevalueofP2Pactivitiessuchasridedispatchingandaccommodation,butitis

unclearwhatvaluefromtheseactivitiesBEAshouldattributeto

thedigitaleconomy.Moreinformation



Atthetimeofthisreport,the2007benchmarktablescontainedthelatestbenchmarkdataavailableanduseda

commodityclassificationsystembasedonthe2007NAICS.

SeeAppendixTable.



10



onthechallengesofmeasuringtheoutputofP2Ptransactionisincludedlaterinthesectionofthis

reportonareasforfuturestudy.



Asmentionedabove,digitalmediaisthecontentthatdigitaleconomyuserscreateandaccess.From

thiscategory,theestimatesinthisreportincludedatastreamingservices,

internetpublishing,and

internetbroadcasting.Streaminganddownloadservicesincludesbothsubscription‐basedservicesthat

allowunlimitedaccesstodigitalcontentaswellasone‐timepurchasesofcontent,suchasrentingand

streamingasinglemovieorpurchasingonesongfordownload.Internetpublishingcapturesfees

collectedfromconsumers

foraccesstodigitalconten tsuchasonlinenewspapers or

magazines.Internetbroadcastingcapturesfeesconsumerspayforsubscriptionstointernetradio,

webcasts,or“simulcasts”wherelargetelevisionsbroadcasterssimultaneouslybroadcastoverthe

Internet.Theestimatesincludeinternetpublishingandbroadcastlicensingwhichistherevenue

publishersreceivebylicensinguse

oftheircontenttootherplatforms.Forexample,awebsitemayhost

anotherpublisher’scontent.Thehostingwebsitemayberequiredtopayalicens ing feetotheoriginal

publisherforrightstohostthecontent.



Otherwebsitesofferfreedigitalmediatoconsumersbutcollectre venuethroughadvertising.While

BEA’snationalaccountsdocapturethisadvertisingrevenue,theestimatesinthisreportdonotinclude

thisrevenue.BEAcurrentlydoesnothavethedataneededtoidentifywhatportionofadvertising

revenueisassociatedwith

thesewebsites.





BEAMethodologyforEstimatingSupply‐UseTables

Thesupply‐usetablesareanintegralandessentialelementoftheU.S.economicaccounts.First,

theyarethebuildingblocksforothereconomicaccounts.ProminentamongthesearetheBEA’s

nationalincomeandproductaccounts(NIPAs),whichfeaturetheestimatesofexpenditure‐based

GDP.Second,thesupply‐usetablessho w

howindustriesinteract;specifically, theyshowhow

industriesprovideinputto,anduseoutputfrom,eachothertoproduceGDP.Theyareacomplete,

balancedsetofeconomicstatistics,andtheypresentafullaccountingofindustryandfinal‐use

transactions.



Thecoreofthesupply‐usetablesconsistsof

twobasicnational‐accountingtables—a“supply”table

anda“use”table.Thesupplytableshowsthecommoditiesthatareavailablefordomestic

consumption.Theusetableshowstheinputstoindustryproduction(intermediateinputs)andthe

commoditiesthatfinalusersconsume.Theusetableisthemostf r equentlyrequestedtable

because

ofitsapplicationstotheestimatesofGDP.



TheBEAusestheNorthAmericanIndustryClassificationSystem(NAICS)tocla ssifyindustries.The

UnitedStates,Canada,andMexicojointlydevelopedthisclassificationsystemwiththeaimof

improvingthecomparabilityoftheireconomicstatistics.NAICSclassifiesindustriesbasedontheir

production

processes.TheNAICScodescomprisesixdigits,whichreadingfromlefttoright,

indicatethegeneralsectordowntoadetailedindustry.

(continuedonnextpage)



11



(3)Identifydigitaleconomyindustriesandprepareresults

BEAestimatednominalvalueadded,output,compensationandemploymentbyindustryforthedigital

economy.Afteridentifyingthegoodsandservicesincluded inthedigitaleconomy,BEAi dentifiedthe

industriesthatproducethosegoodsandservicesusingthesupply table.Digitaleconomygrossoutput

byindustryrepresentsthetotalvalueof

in‐scopegrossoutputproducedbyeachindustry acrossall

digitaleconomygoodsandservices.Valueaddedforthedigitaleconomyisderivedfromthe

relationshipbetweentheindustryoutputforthedigitaleconomyandtotalindustryoutput.Thismeans

theratioofintermediateconsumptionassociatedwiththeindustryoutput

forthedigitaleconomyis

assumedtobethesameastheratiooftotalindustryintermediateconsumptiontototalindustry

output.Compensationandemploymentforthedigitaleconomyarederivedthroughthesame

procedureasvalueadded.Specifically,theratioofanindustry’s digitaleconomyoutputtototaloutput

appliedtototalemploymentandcompensationfortheindustry.



BEApreparedpriceandquantityindexesfordigitaleconomygrossoutputandvalueaddedinthree

steps.First,grossoutputindexesarederivedbydeflatingeachdigitalgoodandserviceproducedbyan

industrythatisincludedaspartofits

grossoutputfromthesupplytable.Second,BEAderivedindexes

forintermediateinputsbydeflatingallcommoditiesfromtheusetablethatareconsumedbythe

industryasintermediateinputsintheproductionofdigitalgoodsandservices.Domesticand

internationalsourcesofintermediateinputsaredeflatedseparatelybyusing

theimportproportionality,

orcomparability,assumption.Third,BEAcalculatedindexesforvalueaddedbyindustryusingthe

double‐deflationmethodinwhichrealvalueaddediscomputedasthedifferencebetweenrealgross

outputandrealintermediateinputswithin aFisherindex‐numberframework.



 

BEAMethodologyforEstimatingSupply‐UseTables(continued)

TheU.S.statisticalsystemdoesnotcurrentlyhaveaseparateclassificationsystemfor

commodities,whicharegroupsofsimilarproductsdefinedbythecharacteristicsoftheproduct

(commodity)itselfratherthanbytheproductionpro cess.Atpresent,BEAusesacommodity

classificationsystemtoassigneachcommoditythecodeofthe

industryinwhichthecommodity

istheprimaryproduct.The foundationforthiscommodityclassificationsystemisthesix‐digit

NAICScode.



BEApreparesbenchmarksupply‐usetablesroughlyeveryfiveyearsbasedonthehighestquality

sourcedata,notablytheU.S.CensusBureau’sEconomicCensuses.Largelybecauseoftheir

rich

sourcedata,thebenchmarksupply‐usetablesarethemostimportantstatisticalsourceof

informationforcomprehensiveupdatesoftheNIPA sandarewidelyusedbyotherstatistical

agencies.BEAreleasedthemostrecentbenchmarksupply‐usetablesin 2015.Theseaccounts

cover2007andusethe2007NAICSfor

classification.Atthetimeofthispublication,BEAis

preparingthe2012benchmarkandcomprehensiveupdateoftheaccountsusingthe2012NAICS,

withaplannedreleasedateoflate2018.



12



Results

Grossdomesticproduct(GDP)orvalueadded

GDPisthevalueofthegoodsandservicesproducedbythenation’seconomylessthevalue ofthegoods

andservicesusedupinproduction.GDPbyindustry,orvalueadded,isameasureofanindustry’s

contributiontooverallGDP.Accordingtotheinitialestimates,thedigi tal economywas

anengineof

GDPgrowththroughouttheperiodcoveredby thesestatistics.In2016,digitaleconomyreal(inflation‐

adjusted)valueaddedtotaled$1,302.2billion,82.2percentlargerthan it wasin2005.From2006to

2016,realvalueaddedforthedigitaleconomyoutpacedoverallgrowthintheeconomyeach

yearand

mitigatedthedownturninGDPduringtherecessionin2008and2009(chart3).Infiveofthoseyears,

including2015and2016,thetwomostrecentoftheseries,thedigitaleconomygrewover6 percent.



Therelativestrengthoftherealdigitaleconomyledittoconsistentlycontributemoretoeconomic

growththanitsshareoftheeconomy.Forexample,in2016,therealdigitaleconomy’sgrowthof6.6

percentaccountedfor28percent,or0.41percentagepoint, ofthetotal1.5percent growthin

realGDP.



From2006to2016,therealdigitaleconomygrewatanaverageannualrateof5.6percent,whilereal

GDPgrewatjust1.5percent(chart4).Withinthedigitaleconomy,hardwareandthecategoryofe‐

commerceanddigitalmediagrewfasterthantheothercomponents,on

average,at11.8percentand

8.6percentannually,respectively.Tele communications grewtheslowestofthecom ponents,on

averageaveraging3.6percentperyear.Overall,averageannualgrowthinrealvalueaddedofdigital

goods,at9.1percent,outpaceddigitalservicesat5.0percent.



From2005to2016,digitaleconomycurrent‐

dollarvalueaddedaccountedforanaverage6.2percentof

totalU.S.current‐dollarGDPeachyear.In2016,digitaleconomycurrent‐dollarGDPtotaled$1,209.2

billion,or6.5percentoftotalU.S. current‐dollarGDP($18,624.5billion)(chart5).



‐4%

‐2%

10%

12%

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Digitaleconomy Totaleconomy

Chart3.DigitalEconomyRealValueAddedandTotalEconomyRealGross

DomesticProduct:PercentageChangefromPreviousYear

U.S.Bureau ofEconomicAnalysis



13



In2016,digital‐enablinginfrastructure,orthehardware,software,telecommunicationsandsupport

servicesthatallowthedigital economytoexist,accountedfor$1,072.6billion(88.7per cent)ofthetotal

estimated$1,209.2billionindigitaleconomycurrent‐dollarvalueadded.Digitaleconomysupport

servicestotaled$362.2billion(30.0per cent)ofthe

totaldigitaleconomy,telecommunicationstotaled

$320.4billion(26percent),softwaretota led$258.8b illion (21.4percent),andhardwaretotaled$131.3

billion(10.9percent)(chart6).E‐commerceanddigitalmediaaccountedfortheremaining$136.5billion

(11.3percent)ofthetotaldigitaleconomycurrent‐dollarvalueadded.Servicesdominatedthedigital

economy,relativetogoods,accountingfor87.5percentoftotaldigitaleconomycurrent‐dollarvalue

added.



0% 5% 10% 15%

Telecommunications

Software

SupportServices

E‐Commerce&DigitalMedia

Hardware

Digitaleconomy

Totaleconomy

U.S.Bureau ofEconomicAnalysis

Chart4.ComponentsoftheDigitalEconomy:

Real ValueAddedAverageAnnualGrowth,2006–2016

$200

$400

$600

$800

$1,000

$1,200

$1,400

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Valueadded Shareoftotalgrossdomesticproduct

Chart5.DigitalEconomyCurrent‐dollarValueAdded(billions)andShareof

TotalCurrent‐dollarGrossDomesticProduct (percentage)

U.S.Bureau ofEconomicAnalysis



14



 



Grossoutput

Grossoutputisameasureofsalesorrevenuefromproductionformostindustries.



Realgrossoutputfor

thedigitaleconomygrewatanannualrateof4.4percentfrom2006to2016,fasterthanthetotal

economy,whichgrewatanaverageannualrateof1.1percentoverthisperiod.Thecompoundeffectof

thefasteroutputgrowthinthedigitaleconomyrelativeto

theoveralleconomyisclearlyseenwhen

outputisindexedtoabaseyear(chart7).Since2010,digitaleconomyrealgrossoutputgrowth

averaged4.9percentperyearandoutpacedaverageannualrealgrossoutputgrowthof2.3percentin

theU.S.economy,overall,wideningthedistancebetweenthe

grossoutputindexesdisplayedinchart7.



0% 10% 20% 30% 40%

Hardware

E‐Commerce&DigitalMedia

Software

Telecommunications

SupportServices

U.S.Bureau ofEconomicAnalysis

Chart6.ComponentsoftheDigitalEconomy:

Current‐dollarValueAddedShareofTotal,2016

100

110

120

130

140

150

160

170

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Digitaleconomy Totaleconomy

Chart7.RealGrossOutputIndex(2005=100)

U.S.Bureau ofEconomicAnalysis



15



Duringthiseconomicrecovery,pricesfordigitaleconomygoodandservicesdecreasedatanaverage

annualrateof0.4percent(chart8).Pricesforallgoodsandservicesintheeconomyincreasedatan

averageannualrateof1.5percent.



Althoughrealoutputinthedigitaleconomyacceleratedfaster

thanrealoutputfortheeconomyoverall,

thefallingpricesofdigitalgoods andservicescausedcurrent‐dollargrossoutputgrowthinthedigital

economyandtheoveralleconomytoberoughlyequaluntil2014(chart9).In2015and2016,total

economycurrent‐dollargrossoutputgrowthdeceleratedwhile 

growthinthedigitaleconomy

acceleratedslightly(from4.3percentaverageannualgrowthoverthe2006to2 014periodto4.7

percentfrom2015to2016).Digitaleconomynominalgrossoutputreached$1.97trillionin2016,

totaling6.2percentoftotalU.S.nominalgrossoutput.



100

110

120

130

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Digitaleconomy Totaleconomy

Chart8.GrossOutputPriceIndex(2005=100)

U.S.Bureau ofEconomicAnal

sis

100

110

120

130

140

150

160

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Digitaleconomy Totaleconomy

Chart9.NominalGrossOutputIndex(2005=100)

U.S.Bureau ofEconomicAnalysis



16



Employmentandcompensation

In2016,thedigitaleconomyemployed5.9millionworkers,representing3.9percentoftotal

employment.Ofalldigitaleconomyworkers,88.2per cent worked inservice‐providingindustries,most

notablycomputersystemsdesignandrelatedservices(1,870,000employees),otherretail(984,000

employees,workingprimarilyine‐commerce),andbroadcastingandtelecom munications(869,000



employees).Onthegoods‐producingside,thecomputerandelectronicproductsmanufacturing

industrysupportedthemostdigitaleconomyjobs(572,000).From2011to2016,employmentinthe

digitaleconomygrewatanaverageannualrateof3.7percentcomparedtoanaverageannualrateof

1.7percentfortheoverall

economy(chart10).



In2016,totalcompensation,includingwagesandbenefits,fortheseworkerswas$674.0billion,or6.8

percentoftotalindustrycompensation.Workersinthedigitaleconomyearnedaverageannual

compensationof$114,275comparedtotheeconomy‐wide averageof$66,498.

‐5%

‐4%

‐3%

‐2%

‐1%

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Digitaleconomy Totaleconomy

Chart10.Employment:PercentageChangefromPreviousYear

U.S.Bureau ofEconomicAnalysis

DataAvailability

Theentiretimeseriesofdigitaleconomyestimates(2005‐2016)areavailableonthedigital

economypageonBEA’swebsite.Dataincludereal,current‐dollar,andpricedataforvalueadded

andgrossoutputbyindustryandbycommodity.Dataarealsoavailableondigitaleconomy

employmentandcompensationbyindustry.



17



Potentialareasforfuturestudy



Thecurrentdigitaleconomyestimatesprovideinsightintotheimpactofthedigitaleconomyonthe

overallU.S.economy.However,thereareopportunitiesforBEAtoexpandthesestatisticsintoa

comprehensivedigitaleconomysatelliteaccounttoreflectmorecompletelythedigitaleconomy’s

contributiontoeconomicgrowth.Potentialareasforfuture

study,discussedbrieflybelow,are:



 Includingadditionaldigitalgoods andservices;

 Incorporatingupdatedstatisticalclassifications,methodologies,andsourcedata;

 AccuratelymeasuringP2Ptransactions;

 Accountingfordigitalinputs toproduction;and

 Estimatingtheconsu mersurplusrelatedtothedigital economy.



Includingadditionaldigitalg oodsandservices

BEAwouldliketoexpandtheseestimatestoincludethevalueofthedigitaleconomygoodsandservices

fromthosegoodsandservicescategoriesthatincludeamixofdigitaland non‐digitalcomponents.For

somecategories,dividingoutputintodigitalandnon‐digitalsegmentsmaybeespeciallychallengingdue

alackofsourcedataorbecauseresearchremainstobedoneregardinghowtovalueconnectivityor

otherdigitalfeaturesofagoodorservice.BEAmayalsoneeddatatosplitthevalueofgoodsand

servicescategoriesbetwe e n differentdigitaleconomycategories. Furthermore,theweightsmayvary

fromyear‐to‐yearforsomegoodsandservicescategoriesbecause oftherapidpaceoftechnological

advancementinthedigitaleconomy.

Incorporatingupdatedstatisticalclassifications,methodologies,andsourcedata

Therapidadvancementofdigitaltechnologyposesotherchallengesaswell.Thedigital economyis

evolvingfasterthanU.S.andinternationalstatisticalclassificationstandards,methodologies,andsource

data.Forexample,theesti matesinthisreportuseBEA's2007benchmarktablesandthe2007NAICS

classificationsystem,whichmeansthatBEAestimates

maynotfullyreflectthecurrentstateofthe

digitaleconomy.Thischallengemaycompoundastechnologycontinuestoadvance.



Additionally,thepaceoftechnologicalchangeposeschallengesfo rpricingdigitaleconomygoodsand

services.Thestatisticalcommunityhasextensivelycommentedandresearchedtheissueofpricechange

fordigital

products.BEAisactivelyengagedinresearchonth istopicandcontinuestoexplorenewdata

sourcestomeasureaccuratelypricechangesfordigitaleconomyestimatesandotherBEAmeasures.

BEAwillcontinuetoupdatetheestimatesusingnewclassifications, methodologies,anddataasthey

becomeavailableandasresourcespermit.



AccuratelymeasuringP2Ptransaction s 

ThereareotherchallengestoproperlymeasuringP2Pe‐commerce’scontribution totheeconomy

beyondthedifficultyinseparatingoutthevalueattributabletothedigitaleconomy.Inthesharing

economy,consumersrenttheirprivategoods andservicestootherconsumers.Consumers’rentalof

theirprivategoods,suchascarsfor

ride‐dispatchingservicesandhomesforlodging,raisesquestionsas

tohowBEAshouldtreatcertainconsumerdurablesandwhethertoconsiderthemasgoodsstrictlyfor



18



finaluseconsumption.

P2Ptransactionsblurtheboundarybetweenproducersandconsumersandcall

intoquestionhowtosplitoutputfromthedigitaleconomyamong thestandardNAICSindustries.



Additionally,revenuesharingamongbusinessintermediariesandassociatedprovidersofgoodsand

servicesmayintroducemeasurementerror.Accordi ngtoAirbnb,itsearningsmaybeaslowas3percent

ofanytotaltransaction,meaningmostofgrossoutputflowstoprivateindividuals.Thisraisestwo

potentialmeasurementissues:(1)business

intermediariesmaydifferintheirreportingofrevenue

(grossrevenueversusnetrevenue),and (2)operatingcostsand/orearningsofhouseholdsmaybe

misreportedorunavailable.ThepresenceofeitherissuewouldcomplicateeffortstomeasureP2Pe‐

commerce.

Accountingfordigitalinputstoproduction

Digitalizationhasrevolutionizedhowbusinesses produce,market,sellanddisseminategoodsand

services.Businessesincreasinglyemploydigitalinputstodrivekey productionactivitiesincluding:online

procurementofintermediateinputs,managementoflogisticalsystems,onlineordigitaladvertising,

internalcommunicationsystems(VoiceoverInternetProtocolorVoIP,onlinemessaging,

teleconferencing,etc.),and

financial,operationalandclientmanagementsoftware.Inthefuture,itmay

bepossibleforBEAtodevelopanewinputcategoryfordigitalinputstoproductionunder thecurrent

KLEMS(K‐capital,L‐labor,E‐energy,M‐materials,andS‐purchasedservices)productionframework.



InformationonbusinessuseofdigitalinputstoproductionwouldlikelybeusefultoBEAforweighting

goodsandservicescategoriesthatinclu de bothdigitalandnon‐digitalcomponents.

Estimatingconsumersurplus

Thisreportdoesnotmeasurechangesinconsumersurplusrelatedtotheconsumptionofdigital

economygoodsandservices.GDPmeasuresthemarketvalueofthegoods,services,andstructures

producedbythenation’seconomyin aperiod.Thatis,itmeasurestheamountthathouseholds,

businesses,andgovernmentsspendon

finalgoodsandservices.Theseaccountsdonotmeasure

consumersurplus,orthedifferencebetweenwhatconsumersarewillingandabletopayforagoodor

service,andthepricethattheypay.



Intoday’seconomy,manyservicesthatinthepastwereavailableforpurchasearenowavailable

free‐

of‐chargeovertheinternet.Forexample,consume rs cancomparequicklyandeasilypricesforflightsor

lodgingusingtravelwebsitesandappsratherthancallingatravelagentorspendingthetimetocall

eachairlineandhotel.Evensomegoodshavenowturnedintoservices.Insteadofpurchasing

aCDora

DVD,digitalmediaallowsconsumerstoaccessordownloadcontentforfreeorforafee.Wikipediaand

Googlehavechangedhowpeoplelearnabouttheworldand searchforinformation.Additionally,a

singlesmartphonereplacesamyriadofindividualgoodsthatconsumersformerlyindividua lly 

purchased,suchasacamera,amusicplayer,avideogameconsole,etc.Thereisgreatinterestamong

digitaleconomystakeholdersindeterminingtheimpactofthesechanges.Inthefuture,BEA may

explorewaystomeasuretheimpactthedigitaleconomy’simpactonconsumerwelfare.



PWC,"TheSharingEconomy",ConsumerIntelligenceSeries.

SeeAhmadandSchreyer,11

FormoreonKLEMS,seehttps://www.bea.gov/faq/index.cfm?faq_id=192.



19



Conclusionandrequestforfeedback



DigitalgoodsandserviceshavedrivengrowthinGDPoverthelastdecade.BEAwillcontinuetomonitor

theproductionandconsumptionofdigitalgoodsandservicesastheU.S.economytransformswiththe

digitalage.Thedigitaleconomyposesmeasurementchallenges,somenewandsomeold,tothe

traditional

methodsofcalculatingGDPandothereconomicmeasures.BEA’sdevelopmentofthese

initialestimatestowardadigitaleconomysatelliteaccountisanim portantstepforwardinproviding

statisticsshowingtheimpactofthedigitaleconomyonthewiderU.S.economy.



BEAwouldlikeinputfromuserstorefinetheseestimatesand

furthertheefforttodevelopa

comprehensivedigitaleconomysatelliteaccount.Pleaseemailallcommentsto

[email protected].BEAisrequestingfeedbackonthefollowingqu estions:



1. DoesthedefinitionproposedbyBEAaccuratelydefinethedigitaleconomy?



2. Whatgoodsandservicesnotcapturedinthecurrentdefinitionofthedigitaleconomyshould

BEAconsiderinscopeforthedigitaleconomysatelliteaccount?Aretheregoodsandservices

currentlyincludedinthedefinitionthatshould

notbeincluded?



3. WhatdatasetscouldBEAusetoestimatein‐scopesharesofpartiallydigitalgoodsandservices?



4. Whowouldusethesenewstatisticsandwhatwouldtheyusethemfor(pleaseprovidespecific

examples)?



5. Beyondstatisticsonvalueadded,output,employment,andcompensation,what

othertypesof

digitaleconomystatisticswouldbeuseful?



6. Whyarethesenewstatisticsneeded?WhatbenefitswouldflowtousersfromBEA‐produced

statisticsinthisareathattheycouldn’t getelsewhere?







20



Acknowledgements



FromtheBureauofEconomicAnalysis:ErichH.Stras s ner,AssociateDirectorforNationalEconomic

Accounts,ThomasF.HowellsIII,ChiefoftheIndustryAnalysisDivision(IAD),andEdwardT.Morgan,

ChiefoftheIndustrySectorDivision(ISD),supervisedthepreparationoftheestimates.MatthewE.

Calby,programmanager,andPhillip

J.SporreroftheInput‐OutputStatisticsBranchmanagedthe

economicinformationsystemsusedtoproduceandreviewthestatistics.CailynM.KreitzandEthan

Scheinprovidedassistance.



FromtheNationalTelecommunications andInformationAdministration(NTIA):GiuliaMcHenry,Chief

Economistprovidedvaluablesupport. 



Thisworkingpapermadepossiblethro ughgenerousfunding

supportfromNTIA.





21



AppendixTable



 

Digitaleconomy

Infrastructure

Hardware

InlcudedfromNAICS333

Digitalelectronicprepresssystems,components,andelements,includingcolorandB/Wscanners,digiti zers,andrecorders

IncludedfromNAICS334

AlarmSystems,includingElectricSirensandHorns

AudioandVideoEquipment,nsk,total

Audiodiscs,records,andcompactdiscs(CD),full‐length

Audiotapes,cassette,full‐length

BarePrinted

CircuitBoardManufacturing

Capacitorsforele ctroniccircuitry

ComputerStorageDevice,nsk,total

Computerstoragede vices (exceptparts,attachments)

Computersystemdesi gn,dataandinformationp rocessi ngandfacilitiesmanagementsvcs‐reclassi fi ed

Computerterminals(excl.parts/attachments/acce ssori es/etc.)

Computerterminals,nsk,total

Consumeraudioandvideoequipment,includingaudioandvideorecordersandplayers(camcorders)andPoweramplifiers,

includingpreamplifiers

Digitalcameras

Electrontubesandparts,excludingglassblanks

Electroniccoils,transformers,andothe rinductors

ElectronicComputersnsk,total

Electronicconnectors

Externalmodems,consumer

Flexiblemagneticdiscsandotherrecordingmedia,incl udingparts

Home,Portable ,andAutomobileRadiosandRadio‐phonograph‐tapeRecorder‐compactDiscCombinations

Hostcomputers,multiusers(mainframes,supe rcomputers,medium

scalesystems,UNIXse rvers,PCservers)

Impactprinters

Inputdevices,alltypes

IntercommunicationsSystems,includingInductivePagingSystems(selectivepaging),exceptTelepho neandTelegraph

Magnetictape

Monitors,accessories,andotherperi pheralequipment.

Nonimpactprinters

Opticaldisks

Opticalscan ningdevices

Othercomputerperipheralequipment,nsk,total

OtherComputers,includingArrayandOthe rAnalog,Hybrid,andSpecial

Purpose

Otherelectroniccomponentmanufacturi ng

Partsandattachmentsforpoin tofsale terminalsandfund‐transferdevices

Parts,Attachments,andAccessoriesforComputerPe ri pheral(input‐output)Equipme nt

Parts,Attachments,andAccessoriesforComputerStorage Devices

Parts,Attachments,andAccessoriesforComputerTerminals(exceptpoint‐of‐saleandfunds‐transferdevi ces)

Point‐of‐sal eTerminals

andFunds‐TransferDevices

Printedcircuitassemblies,loadedboardsandmodule s(printedcircuitboardswithinsertedelectroniccomponents)

Printedcircuitassembly(electronicassembly ),nsk,total

Publicaddresssystems,in cludingmusicalinstrumentamplifi ers

Reproductionofaudiodiscs,records,&compactdiscs

Reproductionofaudiotapes

Reproductionofrecordingmedia,nsk

Reproductionofvideorecordingmedia

Resi storsforelectroniccircuitry

Rigidmagneticdisks

Se miconductorandRelatedDeviceManufacturing

Singleuse rcomputers,microprocessor‐based,capableofsupportingattachedperipherals(personalcomputers,workstations,portable computers)

SoftwareReproducing

Speakers, includingl oudsp eake rssystemsandloudspeakerssoldseparately,andcommercialsoundequi pment

TelevisionReceivers,includingCombinationModels

Vehicularandpe destriantraff iccontrolequipment,includingelectric

railwaysi gnalsandattachments

IncludedfromNAICS339

Otherelectronictoysandgames,in cludinghomevideogames(excludingcartridges,disks,andtape s)

Continuedonnextpage

TableA‐1.Digitaleconomy goodsand servicesinc ludedinBEAestimates



22





Softwar e

IncludedfromNAICS511

Applicationsoftwarepubl ishing(otherthangames)

Gamesoftwarepublishing

InventoryChangeForSoftware Publi shers

Licensingofrightstoreproduce&distributecomputersoftware

Softwarerelatedtechnicalsupportservices

Systemsoftwarepublishing

IncludedfromNAICS541

Own‐AccountSoftware

SupportServices

IncludedfromNAICS518

Applicationserviceprovisioning,we bsitehosting,andotherIT

infrastructureprovisioningservices(include s collocationandstreamingservi ces)

AuxiliaryDataProcessingServices

Busine ssprocessmanagementservices(includesprovisionoffacility)

Datamanagement,processing,storage,andinformationanddocumenttransformationservices

IncludedfromNAICS541

ComputerFacilitiesManagementServices

ComputerSystemsDesignServi ces

CustomComputerProgrammi ng

OtherComputerRelatedServices

IncludedfromNAICS611

Computertrainingscho ols(taxable)

Othertechnical&tradeschools(taxable)

Included

fromNAICS811

Communicationsequipmentrepairandmaintenance

Computer&officemachinerepair&mainte nance

Consumerelectronicsrepairandmainte nance

Telecommunications

IncludedfromNAICS334

Antennasyste ms, soldse parately

Broadcast,studioPartsandaccessories

Broadcast,studio,andrelatedelectronicequipme nt

Carr ierLineEqui pment&Nonconsume rModems

Cellularhandsets(ce ll phones)

DataCommunicationsEquipment(includingrouters,gateways,

bridges, terminalservers,andconcentrators)

Othercommunicationsyste msandequipme nt

OtherCommunicationsEq uipment,nsk

Parts,components,andsubassembl iesforothertelephoneandtelegraphequipment

Parts,components,andsubassembl iesfortelephoneswitchi ngequipment

RadioandTVBroadcastingandWirelessCommunicationsEquipment,nsk

Radiostationequipmentincludingsatelite ,airborneandearth‐based(f ix edandmobile )

Telephone

Apparatus,nsk

Telephonesets,includingwirelessphone sets, excludecellphone s

TelephoneSwitchingEquipment

Wirelessnetw orkingequipment

Wirelinevoiceequipme nt

IncludedfromNAICS335

Electronicwire andcable,madeofnonferrousmetals(purchasedwire )

Fiberop ticcableforcommunication,nsk,total

Fiberop ticcable,allotherapplications

Fiberop ticcable,communicationapplications

Othercommunicationandenergy

wire s,nsk,total

Telephoneandtelegraphwireandcable,madeofnonfe rrousmetals(purchase dwire)

Continuedonnextpage

TableA‐1.Digitaleconomygoodsandservicesinc lud edinBEAestimates(continued)



23



Telecommunications(continued)

IncludedfromNAICS517

Basicfixedlocalteleph ony(otherthantelecomresellers)‐(Include ssubscriberlineandcallingfeaturecharges)

Basicfixedlocalteleph ony(providedbytele communicationsreselle rs)‐ (Includessubscribe rlineandcallingfeaturecharges)

Basicfixedlongdistanceandalldistancetelephony(otherthantelecomresellers)

Basicfixedlongdistanceand

alldis tancetelephony(providedbytelecommunicationsresellers)

Broadband(alwayson)internetaccessservices

Carr ierse rvices(otherthansatellitetel ecom)‐(Include snetworkaccessandInternetbackboneservices)

Forceaccount,telephoneequipme ntinstallation

Internettel eph ony

Licensingofrightstouseintellectualproperty ofallothertelecommunications

Licensingofrightstouseintellectualproperty oftelecomresellers

Licensingofrightstouseintellectualproperty ofwiredtelecomcarriers

Licensingofrightstouseintellectualproperty ofwirelesstelecomcarriers

Mobilelocal,alldi stanceandlongdistancetelephony(otherthante lecomresellers)‐(Includesmobiletelephony callingfeaturecharges)

Mobiletelephony se rvices(providedbytelecommunicationsresellers)‐(Include smobiletelephonycallingfeature

charges)

Multichannelprogrammingdistri butionservices(analoganddigital) (includesstartupandreconnectfees)

Narrowband(di al‐up)internetaccessservicesandothertelecommunicationsservi ces

Pagi ng,mobiledispatch,andspeci alizedwirelessservices

Private networkservices(otherthansatellitetelecom)

Satellitetelecommunicationsservices‐ (includescarrierservi cesandprivatenetworkservicesof satellitetelecommunications)

E‐Commerceanddigital

media

E‐Commerce

Business‐to‐Business

IncludedfromNAICS425

Wholesaletrademarginoutput,BusinesstoBusin essElectronicMarkets

Wholesaletradenonmarginoutput,Busi nesstoBusinessElectronicMarkets

Business‐to‐Consumer

IncludedfromNAICS454

Non‐marginretailtrade,ElectronicAuctions

RetailTradeMargi n,ElectronicSho pping

DigitalMedia

IncludedfromNAICS512

OwnaccountsubscriptionTV

programoriginals

IncludedfromNAICS515

Air‐timesalesforthebroadcastingofradioprogramcontent

Air‐timesalesforthebroadcastingoftele visionprogramcontent

Licensingofrightstobroadcastradioprograms

Licensingofrightstobroadcasttelev is ionprograms

Licensingofrightstodistributespe ciatly televisionoraudioprogrammingcontent

Ownaccountbroadcast

TVprogramoriginals

Publicandnon‐commercialprogrammingservice s‐ Radio(in cludescontributions,gifts,andgrants)

Publicandnon‐commercialprogrammingservice s‐ TV(incl udescontributio ns, gifts,andgrants)

IncludedfromNAICS518

Applicationserviceprovisioning,websitehosting,andotherITinfrastructureprovisioningservices(includescollocationandstreamingservices)

IncludedfromNAICS519

Internetpublishing&broadcasti ng‐ subscriptions&sale s

Licensingofrightstouseintellectualproperty ofinternetpublishersandbroadcaste rs

nsk:notspecifiedbykind

1.ServiceisallocatedtobothI nfras tructure,Supportservices(90%)andDigitalmedia(10%).

U.S.BureauofEconomicAnal ysi s 

TableA‐1.Digitaleconomygoodsandservicesinc lud edinBEAestimates(continued)



24



References



BrentR.Moulton,"GDPandtheDigitalEconomy:KeepingupwiththeChanges,"BureauofEconomic

Analysis(2000).



EconomicsandStatisticsAdministration ,“DigitalEconomy2002”(2002)



EconomicsandStatisticsAdministration, “DigitalEconomy2003”(2003).



InformationEconomy–SectorDefinitionsbasedontheInternationalStandardIndustryClassification

(ISIC4),OECDdocumentDSTI/ICCP/IIS(2006)2/FINAL



NadimAhmadandPaulSchreyer,"MeasuringGDPina DigitalizedEconomy,"OECDStatisticsWorking

Papers,2016/07(2016).



OrganizationforEconomicCooperationandDevelopment,“MeasuringtheInternetEconomy:A

ContributiontotheResearchAgenda,”OECDDigitalEconomyPapers,No.226(2013).



OrganizationforEconomicCooperationandDevelopment,“MeasuringtheDigitalEconomy:ANew 

Perspective.”(2014).



PaulV.Kern,DavidB.Wasshausen,andStevenL.Zemanek,“U.S.ArtsandCulturalProductionSatellite

Account,1998‐2012,”SURVEYOFCURRENTBUSINESS95(January2015).



PricewaterhouseCoopers,"TheSharingEconomy,"ConsumerIntelligenceSeries.

PricewaterhouseCoopersLLP(2015).



RudyTellesJr.,"DigitalMatchingFirms:ANewDefinitioninthe“SharingEconomy”Space,"ESAIssue

Brief#01‐16(2016).



TomMessenbourg,“MeasuringtheDigitalEconomy,”CensusBureau(2001).

