Google Insights Helps Predict The Economy

Well, not really. But aggregated search data can be used to track some economic trends, and can do so better than official economics surveys. The logic behind it is pretty simple: what does the average person do when confronted by something new in their life? Google it, of course.

By using Google Insights to measure search terms like 'real estate agent' or 'unemployment' it's possible to get an idea of how much activity there will be in the property market, or how many people might be signing up for benefits soon. The Bank of England is doing exactly that to supplement their official figures to gain a better picture of the UK economy. The search engine figures aren't 100% accurate, but they are available much faster than government reports.

It's not the first time individual search activity has been aggregated and used to measure large-scale trends. Google Flu Trends uses the same idea: by measuring the frequency of searches for flu symptoms, they can measure levels of flu activity and report it much faster than hospital reported cases. In fact, Google could have spotted the 2009 swine flu outbreak... if they had been monitoring Mexico at the time.

[via Guardian UK]