How Much Does Clickbait Cost the Global Economy?

0:00 How much do you value your own life?

0:03 I need you to think about it carefully because only then

0:05 can we answer the question in the title of this video?

0:08 Now, to maybe help you out a bit here,

0:09 I can actually tell you exactly how much I

0:12 value your life as you sit here watching this video.

0:15 To me, it's worth about $50,000.

0:18 So yeah, maybe this is a good time

0:20 to bring up that there are some people who argue

0:22 that a lot of modern economists have become almost

0:25 sociopathic in their pursuit of rigid mathematical and transactional precision,

0:28 sucking the humanity out of the humanities.

0:31 It sounds almost silly, but this is genuinely one of the biggest

0:34 debates in economics at [music] the moment.

0:36 After all, economics is a study of how people interact with things of value,

0:40 and the most logical measurement for value is a medium of exchange like money.

0:44 For a lot of economies,

0:45 it's assumed that as long as numbers like unemployment, inflation,

0:48 productivity, and incomes go in the right direction,

0:50 that automatically the human experience is also improving.

0:54 But more and more, people are seeing

0:55 that these simple assumptions don't necessarily hold in reality.

0:59 This has resulted in terms of phrase that have become very popular,

1:02 like a vibe session, where headline economic figures look good,

1:05 but most people still feel like they are going backwards.

1:08 So, with that in mind, that $50,000 figure wasn't me trying to be mean.

1:13 It was based on the most accurate hard data I have about you right now.

1:17 Thanks largely to a video I made bullying

1:19 our poor old neighbors over in New Zealand last month.

1:21 This channel got around 5 million views in total,

1:24 which roughly worked out to be a little over half a million hours of watch time.

1:28 567,000 hours of watch time works out to be about 62 years

1:32 or effectively the total waking hours of a nice long human life.

1:37 And at this point, if you've already left a comment about me saying 67,

1:40 we're discounting the value of your life even further.

1:42 For anybody else, in return for the equivalent of a combined human lifetime,

1:46 we made about $50,000 between AdSense and video

1:49 sponsors with a share of that going

1:51 to our team at DE and a share going to YouTube as part of the partner program.

1:55 Now, hopefully most of you watching don't consider our videos clickbait.

1:59 But also hopefully most of you think

2:01 a human lifetime should have much more value,

2:04 even if it's hard to explain exactly why.

2:07 One human lifetime was spent watching these videos and $50,000

2:10 was paid by advertisers to feature on those videos.

2:13 Seems pretty straightforward, right?

2:14 Well, as always, this simple little thought experiment can

2:17 expose a lot about the nature of modern economics.

2:19 And to find out why, we need to answer three simple questions.

2:23 So, why is this straightforward assumption about

2:25 the value of a human life [music] wrong?

2:27 In turn, what does that reveal about the true value of properly wasted time?

2:31 And finally, what do these silly little thought experiments

2:34 tell us about how to properly manage economic value?

2:37 But before we answer that, I need to convert some

2:39 more human lifetimes into revenue with this message from our sponsor.

2:43 Your attention is not the only way large companies monetize your life.

2:46 They also track your every move,

2:48 selling your data to all sorts of corners of the internet.

2:51 I have personally had social security accounts opened in my name.

2:54 That's why I use private internet access.

2:56 [music] Whenever you browse online on an unprotected device,

2:58 it transmits a large amount of information into the open,

3:01 which can be seen by various entities before it reaches the intended website.

3:04 Private Internet Access is a VPN that hides your IP address,

3:08 encrypts your internet connection,

3:09 and keeps your data private and secure at all times.

3:13 One of my concerns with most VPNs is trust.

3:16 What if they are just taking my information

3:17 and telling me they are protecting me?

3:19 PIA eliminates that insecurity as they are one of the few

3:22 VPNs that legally do not track any of your internet activity.

3:25 and this has been proven in court and by a third party audit.

3:28 [music] We use their services for our entire team

3:30 as they offer unlimited devices on a single account.

3:33 Their service also allows you to watch content from all

3:36 over the world that would not be available without a VPN

3:38 which helps us extend and deepen our research as well

3:40 as watch shows that are normally unavailable in our region.

3:43 The Economics Explain team arranged an exclusive deal for you.

3:46 Go to PVPN/economics expplain to receive 83% plus extra months for free

3:51 and you can protect your data for as little as $2 a month.

3:55 Okay, so if the value of a human life isn't actually $50,000, why is that wrong?

4:01 And is there a better solution if

4:02 we're dedicated to answering this rather grim question?

4:05 Well, the reason why most economists would hopefully

4:08 argue that this is wrong is because it

4:09 assumes that all of this time spent watching

4:11 these videos was completely wasted by the viewer.

4:14 In reality, and hopefully,

4:16 all of you watching are getting some utility value out of these videos.

4:19 Maybe they might teach you something about economics that you find interesting.

4:22 Maybe they might make you a better informed voter.

4:24 Or maybe the sweet sound of my bogan draw

4:26 helps you relax after a long hard day of work.

4:28 To each their own.

4:29 This means that only a tiny share of the value enjoyed

4:32 by these thousands of spent hours

4:33 is being captured and transacted by advertisers.

4:36 Now what that share is becomes as much about

4:38 philosophy as it does rigid economic exchange of value.

4:40 And this opens up some interesting ideas.

4:43 According to GDP, the only thing that would

4:45 be measured from you spending time watching this video

4:47 is the advertising revenue because that's the only

4:50 transaction that actually took place in the market.

4:53 So now consider two different theoretical economies.

4:56 Both have a single studio making movies.

4:58 But in the first economy, those movies are streamed for free to households,

5:01 maybe with some commercial breaks.

5:02 But in the second economy, the movies are only shown on paid

5:05 subscription services or in actual paid movie theaters.

5:08 In this very oversimplified scenario,

5:10 life would probably be better for most people in the first theoretical economy,

5:14 where entertainment was free to access,

5:16 but GDP would be significantly higher in the second,

5:19 where everything was behind some kind of pay wall, forcing market transactions.

5:23 A more tangible application of the same kind of idea would be

5:26 things like smartphones replacing dozens of individual

5:29 pieces of technology from decades prior.

5:31 Theoretically, GDP would look better if companies produced

5:34 and sold a digital camera, a music player,

5:36 cellular phone, navigation system, pager,

5:38 and pedometer separately instead of in one single device.

5:41 But clear tangible value is higher when we

5:44 can enjoy all of these functions using our smartphones,

5:46 even if perhaps their convenience sometimes goes too far.

5:49 But again, we'll get to that.

5:51 This logical failing of such an important economic metric has

5:54 actually inspired some economists to propose what they call GDPB,

5:58 a measure of gross domestic product,

6:00 which in addition to measuring the value of goods

6:02 and services produced and sold into the market,

6:04 also accounts for the value of free goods as well.

6:07 Now again, actual hard data on these simultaneously free but valuable

6:11 services are significantly harder to collect because without transaction data,

6:15 how much they are actually worth is open to a lot more interpretation.

6:19 What the economists did was effectively question what people would

6:22 need to receive in order to give up services like Facebook,

6:25 YouTube or the inbuilt features in their smartphones.

6:27 And what they generally found was that largely there was a huge amount

6:30 of value being created by these services

6:32 that wasn't being captured by headline macroeconomic figures.

6:35 Now this is really important stuff because it

6:37 means if the supply of these free services falls,

6:40 it can have a large impact on our experienced

6:42 well-being while being completely invisible from most economic data.

6:46 We have arguably seen this play out in most economies over the last decade.

6:50 Back 10 years ago, there were a lot of digital services in particular

6:53 that were either free or heavily subsidized

6:56 by a combination of investor dollars and advertising.

6:58 The value to users was higher than the prices they were charging,

7:01 which was used as a way to grow market share.

7:03 But in the meantime, we all got to enjoy some cheap services.

7:07 Today, that has changed.

7:09 The price of things like Uber rides or food

7:11 delivery has risen to introduce a profit margin.

7:13 And even for the services that have remained free to use,

7:16 overwhelmingly people have noticed a trend towards more ads,

7:19 more upsells, and more nuisance to use.

7:21 And look, of course, big disclaimer time.

7:24 We, as a YouTube channel, directly benefit from this trend.

7:27 Back when this channel first really started 7 years ago,

7:29 we roughly made about half as much for every,000 views as we do today.

7:33 Largely, that is because the platform shows more ads at more regular intervals.

7:37 Partially, it's because it's cut down on ad blockers,

7:39 and partially it's because more of you are

7:41 using YouTube Premium to pay away this annoyance.

7:43 Had we been making this video back then,

7:46 we would have opened with a, let's call it a joke about the value

7:48 of human lifetime being worth around

7:50 $30,000 by using the same basic calculations.

7:54 So, ironically, by valuing your time less,

7:57 recent economic trends have made your time more valuable.

8:00 But then it becomes a question of valuable for who?

8:04 Whom?

8:04 Whomst?

8:05 editor.

8:05 Just put whatever the smart one is.

8:07 And this is where we get to a discussion of how

8:09 much something like clickbait has truly cost the global economy.

8:12 Don't worry, I wasn't going to clickbait you in a video about clickbait.

8:15 Now, the simple solution would be to take studies estimating

8:17 how much time people spend on their devices outside of work.

8:20 Find the portion of that time wasted on misleading content

8:23 and multiply it by the national average productivity for those workers.

8:26 That is the calculation of how much economic

8:28 value they create for every hour of work.

8:31 Now, we actually have all of those numbers

8:33 from reliable enough sources to make a pretty good estimate.

8:36 Global GDP was about 110 trillion US in 2024

8:40 and will most likely be slightly higher in 2025.

8:43 That value was created by a collective

8:45 global labor force of roughly 3.7 billion people

8:48 who on average spent 1,800 hours a year

8:51 doing work to produce value for the market.

8:53 At the same time, a study of the same year found that on average,

8:56 people from most measured countries,

8:58 which did exclude places like North Korea and active war zones,

9:01 were using their phones for about 5 hours a day on average.

9:05 This was roughly backed up by similar studies that found that people in the USA

9:08 in particular were using their phones on average

9:10 for 5 hours and 16 minutes every day.

9:13 And it also found that an average of three of those hours

9:15 were spent on a phone during work hours on work days.

9:18 But before you judge, make sure to ask yourself,

9:21 are you supposed to be working right now?

9:22 Don't worry, I won't tell as long as you're subscribed.

9:25 Now, if we assume that these numbers are roughly accurate and the average

9:29 person works 4 days a week to account for the part-time workers,

9:32 that means 12 hours out of an average of 35

9:34 weekly hours of phone time are done in lie of work.

9:37 Now, either way you shake it,

9:39 that is probably too much time spent staring at a screen,

9:41 especially when this number doesn't even include TVs, computers,

9:44 smart fridges, and everything else that people have put screens onto.

9:47 But we aren't here to judge.

9:49 We're here to extrapolate.

9:51 12 hours a week is 624 hours a year.

9:53 And assuming the average person takes 2 weeks off a year,

9:56 let's call it a nice round 600 hours of onthe-clock phone time.

10:01 Now, 600 hours multiplied by the average hourly productivity

10:03 of $18 multiplied by $3.7 billion workers around the world

10:08 means that this lost time is worth about $40

10:11 trillion or more than a third of all current GDP.

10:15 That is already a huge number, bigly even.

10:18 But when making calculations like this, it's

10:20 good to look for some basic sanity checks.

10:23 And since 12 hours is slightly more than a third of the average work week,

10:26 the basic arithmetic does work out.

10:28 However, some further refinements of our assumptions could

10:31 show that this might actually be an underestimate.

10:34 Hourly productivity in most advanced economies is closer to $70 an hour.

10:38 Particular standouts like the USA are almost

10:40 $100 an hour in generated market value.

10:43 Now, these economies also generally have a higher share of white

10:46 collar work where people are sitting in front of a screen anyway.

10:49 So, it's not unreasonable to assume that a higher share

10:52 of their time is spent looking at some cheeky brain rot.

10:55 So, does that mean we could double global output if only we

10:58 put down our phones and didn't waste a single second of company time?

11:02 Well, no, of course not.

11:03 For starters, this is making the same

11:05 flawed assumption of the value of human life.

11:07 relaxing, even if it is on the job, has value to the people doing it,

11:11 even if that value can't be directly captured by the market.

11:14 On top of this, it's not like people

11:16 before smartphones didn't waste time in the office either.

11:19 And in most roles where people are doing this, there

11:21 is often only so much work that needs to be done.

11:24 In this instance, the real waste of human time probably comes

11:27 more from keeping people there for a set 40 hours a week,

11:30 but we've already made an entire video about that.

11:32 So again, we need to look specifically

11:34 at what amount of time is just spent reading

11:37 or watching things that are completely a waste

11:39 of time and only extract value from all participants, [music] as in clickbait.

11:44 Now, fortunately, a lot of smart people also

11:46 spend a lot of time tracking this as well.

11:48 Not necessarily because they want you to spend your time better,

11:51 but rather because they want marketers to spend their [music] budgets better.

11:54 A now relatively infamous report by the Association

11:57 of National Advertisers found that as much

11:59 as 23% of programming ad spend was effectively

12:02 squandered on what they politely called lowquality websites.

12:06 This report also looked at other pitfalls

12:07 like bot traffic and excessively high ad loads.

12:10 And additionally, people generally spend less time on a site

12:12 or watching a video once they realize it's just clickbait.

12:15 But even still, it's fairly safe to assume that at least

12:18 5% of this time was just wasted on zero value content.

12:22 That would mean around $2 trillion of productive

12:25 time is wasted every year on clickbait.

12:27 Throwing in the hundred billion from the advertisers,

12:29 and this is taking more from global GDP than Australia is contributing.

12:33 Beyond providing no value in exchange for the time and money it sucks up,

12:37 some of this content could actually be actively causing harm.

12:40 Oxford's word of the year for 2025 was rage bait,

12:43 which is not a word, and that by itself makes me angry,

12:45 but it also does show how pervasive the push

12:48 to get something negative in front of our faces has become.

12:51 Now, of course, this was just a thought

12:53 experiment to tackle some often forgotten fundamentals of economics.

12:56 At the end of the day,

12:57 it's supposed to be a study of how people interact with things of value.

13:00 And not to get too sappy here, but time really is the ultimate scarce resource.

13:04 Now, this has real implications beyond just motivational go out

13:08 there and make the best of your day type talk.

13:10 Paying more attention to what people value

13:12 rather than things that are just valuable can

13:14 help us get a much better understanding

13:15 of the true prosperity our economic systems [music] deliver.

13:18 Just making numbers go up by harvesting more

13:20 hours or converting them into transactable assets more

13:23 efficiently isn't necessarily the economic success that a lot

13:26 of economic metrics would have us [music] believe.

13:28 The opposite side of that same idea is

13:30 that economists arguably could do a better job

13:32 of accounting for things that heighten the human

13:34 experience but aren't necessarily transactable or easily measurable.

13:38 Now this doesn't need to be as extreme as something like Bhutan that's

13:41 assued traditional GDP and introduced a gross

13:43 national happiness metric in its place.

13:45 But there are still ways to track these indicators and use

13:48 them to provide muchneeded context on how well people are actually living.

13:52 Now, we've actually made an entire video on one

13:54 particular economy that got this so badly wrong,

13:57 it undermined regular economic performance as well.

14:00 You should be able to click to that on your screen now.

14:02 Thanks for watching, mate.

14:03 Bye.