He's saying that the standard methods of calculating economic statistics don't capture consumer surplus very well.
I've made similar arguments in the past claiming that US growth is also understated. According to official statistics, for example, US real wages have stagnated since the 70's. Yet would anyone be willing to trade in their 2010 basket of consumer goods for a 1970's basket of consumer goods? If real wages truly did not go up, then most people should be indifferent.
I've made similar arguments in the past claiming that US growth is also understated. According to official statistics, for example, US real wages have stagnated since the 70's. Yet would anyone be willing to trade in their 2010 basket of consumer goods for a 1970's basket of consumer goods? If real wages truly did not go up, then most people should be indifferent.