Productivity plummeted in the first quarter of 2015. The general fear among economists is that as the productivity stats fall, labor costs for major corporations will increase while profits decrease. This could start a chain reaction and ravage the already-suffering U.S. economy.
However, the technology economists from Silicon Valley, including Google Inc. chief economist Hal Varian, claim the productivity formula is obsolete. According to them, there are several reasons for this:
Lack of Measurement
Most new technologies, such as software apps and gadgets, are free or nearly free. Many of these apps increase productivity for their users in several ...