Over the past few years, our daily lives have undergone fundamental changes. The coronavirus pandemic has provided people around the world with an opportunity to reconsider how they spend their time. This shift is prominently reflected in economic indicators that, at first glance, seem unrelated, such as the growth in Google’s revenues and the rise in housing prices. In this article, we explore the impact of pre- and post-pandemic time usage on the economy from a unique perspective.
The pandemic has brought about a clear change in the proliferation of remote work. Many people saved commuting time, leading to an increase in time spent at home. This redistribution of time directly led to an increase in the use of digital platforms like Google, boosting advertising revenue and demand for services such as Google Cloud. On the other hand, spending more time at home has heightened the desire to invest in one’s living space. The need for home office furniture and equipment, along with a desire for a more comfortable living environment, has driven up demand in the housing market and, consequently, housing prices.
Looking back at the situation before the pandemic, economic growth, technological innovation, and particularly the low interest rate environment positively impacted both Google’s revenue and the housing market. Monetary policy reduced corporate financing costs and lowered the barriers to purchasing homes by reducing the burden of mortgage interest. Furthermore, during periods of inflation, asset prices, including real estate, tend to rise, promoting investment in housing as a means of preserving value.
In an inflationary environment, companies like Google can easily adjust advertising prices and service pricing to maintain and grow revenue. However, the impact of inflation on the overall economy is complex, and a buoyant housing market could further exacerbate inflationary pressures, potentially leading the central bank to raise interest rates.
Economic policy, especially the central bank’s interest rate policy, has a significant impact on both the housing market and technology companies like Google. An increase in interest rates could cool the housing market by raising the cost of mortgages. At the same time, fluctuations in the financial markets could affect the funding environment for technology companies.
Thus, the pandemic has changed how we allocate our time, affecting various aspects of the economy. The spread of remote work, increased interest in home investment, and changes in economic activity under inflation have provided us with new perspectives on how we live, work, and invest. Understanding these changes is crucial for predicting future economic trends and devising strategies to respond to them. The way we use the resource of time will be key to shaping the economic future.
