Is Big Data an Economic Big Dud?
“Big Data,” the billions and billions of gigabytes of information transmitted over the Internet, may be the world’s next big global financial asset. The World Economic Forum considers it to be an innovative and transformative economic driver akin to electricity or the refining of oil into gasoline.
But is it really the big boom many think?
Northwestern University economist Robert Gordon tells The New York Times that comparing “Big Data” to “Big Oil” is big rubbish.
“Gasoline made from oil made possible a transportation revolution as cars replaced horses and as commercial air transportation replaced railroads,” said Gordon, the Stanley G. Harris Professor of Economics at Northwestern’s Weinberg College of Arts and Sciences. “If anybody thinks that personal data are comparable to real oil and real vehicles, they don’t appreciate the realities of the last century.”
In the same article, Shane Greenstein, a professor of management and strategy at Northwestern’s Kellogg School of Management, tells the Times it may be too early to label “Big Data” an economic bust. He says technological infrastructure investments often take a long time to pay off.
“It could be just time delay, or it could be that the value just isn’t there,” he said.
Greenstein says improvements made in the late 1990s have only recently translated into profits.
Read more about “Big Data” and Gordon and Greenstein’s thoughts in the complete New York Times story.