Economists study urban economic indicators

Move over GDP, CPI, sales tax and retail sales. Some economists now are turning to urban economic indicators for spending, moving and working to get a new gauge on the economy. Reading the urban “tea leaves” means tracking new indicators, such as counting the number of subway passengers near hot shopping districts, watching theater ticket sales, and even reviewing costs for average apartment rentals on Craigslist.

As reported by Wall Street Journal, some economists no longer are waiting six months for leading economic indicators to be released. Instead, they are finding different, and sometimes unorthodox, ways to listen and interpret key signals.  As cited in the article:

• In California, diesel fuel sales can help forecast industrial production.
• Broadway ticket sales in New York City can help predict tourist revenue.
• Subway passenger traffic in San Francisco can help suggest sale-tax revenues.
• Apartment rentals on Craigslist can help measure local changes in pricing, consumer sentiment and the economy (instead of waiting for bi-monthly Labor Department data).
• Even web searches for “unemployment office” and “jobs” can signal a jump in initial jobless claims.

Granted, some economists still don’t put a ton of stock in such potentially untested and more volatile urban data. Yet recent studies have shown that urban data, like tracking the sale of diesel fuel nationwide, can give a strong snapshot of the health of U.S. industrial production, GDP, and regionally, manufacturing and construction employment.

Even so, when it comes to economics, there’s a quote attributed to George Bernard Shaw that comes to mind: “If you laid all the economists in the world end to end, they still wouldn’t reach a conclusion.”

On one hand, maybe by using classic and emerging urban economic indicators, economists might actually reach a conclusion sooner.

On the other hand, is there such a thing as a one-handed economist?