Decision-makers across the public and private sectors need accurate and timely information on economic activity for effective action and interventions. At present, the information available is highly fragmented, privately held, and low in accuracy, making coordination among economic actors difficult. The cost of acquiring information and increasing its accuracy is borne privately, leading to asymmetry in the marketplace and an increase in transactions costs as well as the discount rate for future transactions.
We propose to develop an index of economic activity using big data analytics at the highest possible spatial and temporal resolution. One of the objectives of the index would be to capture the economic activity in the informal as well as the formal sectors. This is particularly important given the large scale of the informal sector in India.
The potential topics include:
1. Price Index: This initiative will use prices collected daily from several online retailers around the country to provide information about the evolution of price situation or inflation.
2. Employment Index: This index will use data on online job postings to capture skill demands for professionals across firms and labor markets and the recovery of jobs post COVID.
3. Sentiment Index: This index will use social media activity of firms across diverse sectors to provide insights into their economic health or vulnerability, which is useful for government and business.
4. Aviation Index: Data of passenger travel from online travel aggregators for demand across all carriers.