In such an environment, the availability of detailed micro-level data describing the attributes of these goods is crucial. One means of defining the unit of output is to unbundle the characteristics of a high-tech product and to price each of them separately. This so-called "hedonic" technique - now 1 applied by the BEA to items that account for 18 percent of GDP--is one approach.
In our work at the Federal Reserve, we have developed hedonic price indexes for network routers and switches using, in the case of the former, data from product catalogs and, in the case of the latter, privately produced reports evaluating the performance of the products. However, hedonics are by no means a panacea.