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Blog Post

National Academies’ Decadal Survey Points to the Need to Value Earth Science Satellite Data

Jan 29, 2018 | Bethany Mabee

A recent report from the National Academies of Sciences, Engineering, and Medicine emphasizes the importance of observing Earth from space from both a scientific and societal standpoint. “Space-based Earth observations provide a global perspective of Earth that has…transformed our scientific understanding of the planet,” the authors write, and “enabled societal applications that provide tremendous value to individuals, businesses, the nation, and the world.”

They go on to observe how “US investments in Earth observations over the last decade have led to important scientific advancement, and generated considerable economic value” (1–11). The use of Earth observations has been shown to yield socioeconomic benefits in a variety of decision contexts, ranging from assisting the US Navy in its operations to helping tea farmers in Kenya protect their crops from frost.

Many of us recognize that the information gathered by satellites benefits us when it is applied to make us healthier, ensure we have adequate food to eat, protect us from disasters, safeguard our water supply, and support thriving ecosystems around us. But how can we determine what the economic value of these observations is? And why is it important for us to do this?

Valuing the Economic Benefits of Earth Observations

Since 2016, Resources for the Future (RFF) has been collaborating with the National Aeronautics and Space Administration (NASA) to address these questions with the Consortium for the Valuation of Applications Benefits Linked with Earth Science (VALUABLES).

Through interdisciplinary collaboration between Earth and social scientists, the VALUABLES Consortium is exploring how to assign an accurate economic value to specific applications of remotely sensed information by using a rigorous, economic method known as the value of information, or VOI. As the authors of the National Academies’ report observe, with this method “the ‘value’ of the information is derived directly from the value of the decision” being made (4–2).

Calculating VOI involves comparing how a decision would be made under two different scenarios: a baseline knowledge scenario and an improved knowledge scenario. For example, quantifying the value of measurements of water quality using satellite data would require identifying how the actions of a decisionmaker who uses those satellite-based measurements (perhaps a local or state regulator) differ from the actions that the decisionmaker would have taken using the next-best alternative (perhaps in-situ data or imagery collected from aircraft).

Another key part of the consortium’s work is building capacity within the Earth science community so scientists can better understand the terms, concepts, and methods related to impact assessments and engage in the assessments needed to quantify and build awareness about the socioeconomic benefits that Earth science applications produce. Last summer, for example, the VALUABLES Consortium joined NASA’s Water Resources team meeting to discuss how participants could quantify the benefits of the Earth science data applications used for water resources management.

Why Is It Important to Determine the Economic Value of Earth Observations?

In a world of limited resources—what economists describe as “scarcity”—we need tools to help us choose in what to invest our resources. Scarcity creates tradeoffs, and one way we can translate these tradeoffs into strategies for allocating limited funds is to use valuation techniques like VOI. As the National Academies report authors observe, a “growing body of literature uses VOI specifically to value Earth science satellite data” (4–2). Analytical techniques like VOI allow us to assign an economic value to the benefits that Earth observations provide to society.

As they look ahead to the next ten years, the National Academies report authors help us understand why valuation is important. They remind us that “[d]ecisions we make this decade regarding investments in needed capabilities will determine our capacity during the next decade and beyond to predict Earth’s future changes, including the role of human actions, and to influence the extent to which those changes will impact society” (1–11). Economics—and socioeconomic impact assessment methods in particular—can help ensure that these decisions are made with better knowledge of the societal benefits that a particular course of action might produce.

Interested in Learning More?

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The views expressed in RFF blog posts are those of the authors and should not be attributed to Resources for the Future.