All countries will eventually need to rebuild their growth models around digital technologies and the human capital that supports their deployment and expansion.
Michael SpenceRead
One way to measure the size of a company, industry, or economy is to determine its output. But a better way is to determine its added value - namely, the difference between the value of its outputs, that is, the goods and services it produces, and the costs of its inputs, such as the raw materials and energy it consumes.
Interpretation
What this quote means
The value of a company is better measured by its added value than by its total output.
This quote emphasizes that assessing a company's worth should go beyond merely evaluating the volume of goods and services produced. Instead, the focus should be on the added value, which is the difference between the revenue generated from outputs and the costs incurred from inputs, thus highlighting the importance of efficiency and innovation in creating value within an economy.
Themes
ValueOutputEconomyAdded ValueInput
In practice
Example use cases
A business presentation on how to improve productivity by focusing on added value.
More from Michael Spence
All quotes →Developing economies may not have much control over the headwinds that they face today, but that does not mean that they are powerless. Much can be done not just to sustain moderate growth but also to secure a more prosperous and resilient future.
Michael SpenceRead
Reforms aimed at increasing an economy's flexibility are always hard - and even more so at a time of weak growth - because they require eliminating protections for vested interests in the short term for the sake of greater long-term prosperity.
Michael SpenceRead
Similar quotes
The trouble with capitalism as a system is that only those who have or can get capital can make it work for them, and that leaves out damn near all of us.
Molly IvinsRead
The value of a thing is the amount of laboring or work that its possession will save the possessor.
Henry GeorgeRead
We contend that for a nation to try to tax itself into prosperity is like a man standing in a bucket and trying to lift himself up by the handle.
Winston ChurchillRead
Why does a public discussion of economic policy so often show the abysmal ignorance of the participants?
Robert SolowRead
If anything, taxes for the lower and middle class and maybe even the upper-middle class should even probably be cut further. But I think that people at the high end - people like myself - should be paying a lot more in taxes. We have it better than we've ever had it.
Warren BuffettRead
Does inequality in the distribution of income increase or decrease in the course of a country's economic growth?
Simon KuznetsRead