Far out: measuring GDP from orbit

Outer space offers a new way for measuring economic growth, according to a new working paper by three Brown University economists. In their paper, J. Vernon Henderson, Adam Storeygard and David N. Weil suggest a new framework for estimating a region’s gross domestic product (GDP) by using satellite images of the area’s nighttime lights.

(Pic: Increased nighttime lighting in Poland (top left quarter of each pic) and Eastern Europe between 1992 and 2002. Poland is in the top left quarter of each image.)

Illustrating the lack of precision in traditionally compiled figures, the authors cite the Penn World Tables, which show the growth figures from sub-Saharan African countries to have a 30-40 percent margin of error.

To improve accuracy, the researchers suggest combining measured income data with the changes observed in a country’s “night lights” as seen from space. Using satellite picture composites, they look at changes in a region’s light density over a 10-year period. “Consumption of nearly all goods in the evening requires lights,” they write. “As income rises, so does light usage per person, in both consumption activities and many investment activities.”

When the researchers applied the new methodology to countries with low-quality national income data, the new estimates were significantly different. For example, in the Democratic Republic of Congo, lights suggest a 2.4 percent annual growth rate in GDP, while official estimates suggest a negative 2.6 percent growth over the same time period. At the other end of the spectrum, Myanmar has an official growth rate of 8.6 percent a year, but the lights data imply only a 3.4 percent annual growth rate.

The team say they don’t envision the lights density data as a replacement for official numbers, but when added to existing data from agencies like the World Bank, the lights density can provide a better indicator of how these economies really are performing. “Our hope is that people start using this, either when they don’t have actual data on economic growth or when the numbers are pretty bad,” said Henderson.

Related:
Academics question surge’s success in Baghdad

Source: Brown University

, ,

Comments are closed.

NICBUSTER 4 Hole Disposable Cigarette Filters - Bulk Economy Pack (1200 Filters) picture

NICBUSTER 4 Hole Disposable Cigarette Filters - Bulk Economy Pack (1200 Filters)

$33.95



NICBUSTER 4 Hole Disposable Cigarette Filters - Bulk Economy Pack (300 Filters) picture

NICBUSTER 4 Hole Disposable Cigarette Filters - Bulk Economy Pack (300 Filters)

$11.95



NIC-BLOCK  Cigarette Filters Bulk Economy Pack 300 + 150 FREE BONUS FILTERS TIPS picture

NIC-BLOCK Cigarette Filters Bulk Economy Pack 300 + 150 FREE BONUS FILTERS TIPS

$16.35



18mm ECONOMY HORNED SLIDE 5 HOLE SCREEN Tobacco Glass Slide Bowl 18 mm male picture

18mm ECONOMY HORNED SLIDE 5 HOLE SCREEN Tobacco Glass Slide Bowl 18 mm male

$11.95



CALCIUM CARBIDE FINE grade cannon big bang bangsite economy size  picture

CALCIUM CARBIDE FINE grade cannon big bang bangsite economy size

$23.50



18mm 7 HOLE BUILT-IN SCREEN ECONOMY SLIDE Tobacco Glass Slide Bowl 18 mm male picture

18mm 7 HOLE BUILT-IN SCREEN ECONOMY SLIDE Tobacco Glass Slide Bowl 18 mm male

$12.95



BEEHIVE

BEEHIVE "ECONOMY ACCUMULATES WEALTH" Mechanical Bank - PIQUA, OHIO

$549.00



Eveready Industrial Economy 2D 7.8

Eveready Industrial Economy 2D 7.8" LED Flashlight Yellow (1251L) 222397

$11.45



Brown Leather economy Belt Sheath for 6+

Brown Leather economy Belt Sheath for 6+" Fixed Blade Hunting Knife

$12.70



United Scientific 7.5 in. Dia. Economy Aneroid Barometer picture

United Scientific 7.5 in. Dia. Economy Aneroid Barometer

$26.71



Powered by WordPress. Designed by WooThemes