Economic Assessment of the Use Value of Geospatial Information (2015)


Geospatial data inform decision makers. An economic model that involves application of spatial and temporal scientific, technical, and economic data in decision making is described. The value of information (VOI) contained in geospatial data is the difference between the net benefits (in present value terms) of a decision with and without the information. A range of technologies is used to collect and distribute geospatial data. These technical activities are linked to examples that show how the data can be applied in decision making, which is a cultural activity. The economic model for assessing the VOI in geospatial data for decision making is applied to three examples: (1) a retrospective model about environmental regulation of agrochemicals; (2) a prospective model about the impact and mitigation of earthquakes in urban areas; and (3) a prospective model about developing private–public geospatial information for an ecosystem services market. Each example demonstrates the potential value of geospatial information in a decision with uncertain information.

Geographical scope

United States

Non-quantified impacts

The approach outlined demonstrates the benefits of supplying geospatial data that enhances productivity and promotes economic growth. The three examples described offer specific cases that can provide significant benefits for environmental regulation, natural hazard mitigation and support for ecosystems services cap and trade markets. Advances in technology, such as high-resolution earth observation that can be considered “specific” information, have added new potential inputs to decision making. Although the benefits for specific use cases of geospatial information would be substantial, implementation is not obvious or simple. Barriers to use exist because applications will require investment in integrated models. Open access to the data does not necessarily provide open access to the application or interpretation of the data.

Quantifiable impacts

  1. Environmental Regulation of Agrochemicals: Geospatial Data Provide Information for Regional Environmental and Health Policy Decisions – a conservative (more realistic) rate of land use change that yields a 1% improvement in land allocation has an estimated VOI for MRLI of an annualized USD 43 million/year (in USD 2010) and has a net present value of USD 1.91 billion for the 35 counties in Iowa.
  2. An Application to Earthquake Hazards Mitigation and Income Distribution: Geospatial Information Provides Input for Earthquake Housing Risk Concentration in a Hazard Scenario for a Hazard Scenario – applying the voluntary program until mitigation costs cross the threshold, then at costs above the threshold, application of the cost minimising regulation program offers additional net benefits. That is, as mitigation cost rises beyond 16% the combined program translates into USD 59 million additional net benefits and 163 more buildings that would not have been mitigated under the voluntary mitigation policy.



Study type

Estimating value of use in decision making

Economy sector

Disaster Risk Management, Retail, Agriculture