How do you put a value on free products?

"Hair oil, shampoos, toothpastes and biscuits have been among the worst hit in the FMCG (fast moving consumer goods) industry due to the prolonged slowdown in consumer spending, which has hit volume growth of major players in the previous quarter." While other goods saw a fall in the rate of growth, volume of toothpaste sale actually shrank by 3%. This is alarming because dental health is linked to general health and poor dental hygiene could be the source of serious illness. Since 55 million people in India were pushed into poverty last year because of medical emergencies we need studies to show if economic slowdown is causing poverty to rise, not just remain at the same level. Stories of rising debt and poverty in rural areas have been published but we need figures. "The most startling fact about the Indian economy over the past few quarters is the collapse in nominal economic growth to its lowest level in two decades," wrote N Rajadhyaksha. This is important because tax collection depends on the nominal GDP, so falling nominal growth means lower than expected tax collection when there is pressure on the government to increase spending to stimulate growth. ""The latest quarterly nominal growth rate is lower than the incremental cost of government borrowing, a flashing amber light for a country such as India that also has a primary government deficit." The Reserve Bank (RBI) can slash interest rate but that may not increase lending as companies are still trying to reduce their enormous debt loads while banks are loath to lend until the bad loans have been cleared up. This is the twin balance sheet problem. Increasing fiscal spending could increase the cost of borrowing by increasing bond yields and a weaker rupee may help exports but could be disastrous for firms which have unhedged dollar borrowings. Macroeconomics has failed to prevent repeated economic crises in the last 25 years and its remedies are not working, wrote R Jagannathan. Technology is making things worse. "There is a huge collaborative economy for free products, from free publications on the web to electronic marketplaces that let borrowers and lenders, buyers and sellers, do business at zero or low cost." "The fact that so much innovation is given away for free does not only create a measurement problem for economists; it is also a real problem for those trying to find investment opportunities," wrote Prof R Hausmann. So, how to cure the economy if economists don't have an answer? Go for broke in the next budget, suggests Jagannathan. Forget about fiscal prudence and "focus on big bang spending" and "bring all off-balance-sheet borrowings by public sector companies such as Food Corporation of India back into the budget by clearing their dues in a single shot". "That will push the overall fiscal deficit to nearly 5.5-6% of gross domestic product (GDP), but this is not a time to fret about empty numbers." That could create questions this government may find hard to answer. Elections are not won on telling the truth.