Selected Readings on Economic Impact of Open Data

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The Living Library’s Selected Readings series seeks to build a knowledge base on innovative approaches for improving the effectiveness and legitimacy of governance. This curated and annotated collection of recommended works on the topic of open data was originally published in 2014.

Open data is publicly available data – often released by governments, scientists, and occasionally private companies – that is made available for anyone to use, in a machine-readable format, free of charge. Considerable attention has been devoted to the economic potential of open data for businesses and other organizations, and it is now widely accepted that open data plays an important role in spurring innovation, growth, and job creation. From new business models to innovation in local governance, open data is being quickly adopted as a valuable resource at many levels.

Measuring and analyzing the economic impact of open data in a systematic way is challenging, and governments as well as other providers of open data seek to provide access to the data in a standardized way. As governmental transparency increases and open data changes business models and activities in many economic sectors, it is important to understand best practices for releasing and using non-proprietary, public information. Costs, social challenges, and technical barriers also influence the economic impact of open data.

These selected readings are intended as a first step in the direction of answering the question of if we can and how we consider if opening data spurs economic impact.

Selected Reading List (in alphabetical order)

Annotated Selected Reading List (in alphabetical order)

Bonina, Carla. New Business Models and the Values of Open Data: Definitions, Challenges, and Opportunities. NEMODE 3K – Small Grants Call 2013. http://bit.ly/1xGf9oe

  • In this paper, Dr. Carla Bonina provides an introduction to open data and open data business models, evaluating their potential economic value and identifying future challenges for the effectiveness of open data, such as personal data and privacy, the emerging data divide, and the costs of collecting, producing and releasing open (government) data.

Carpenter, John and Phil Watts. Assessing the Value of OS OpenData™ to the Economy of Great Britain – Synopsis. June 2013. Accessed July 25, 2014. http://bit.ly/1rTLVUE

  • John Carpenter and Phil Watts of Ordnance Survey undertook a study to examine the economic impact of open data to the economy of Great Britain. Using a variety of methods such as case studies, interviews, downlad analysis, adoption rates, impact calculation, and CGE modeling, the authors estimates that the OS OpenData initiative will deliver a net of increase in GDP of £13 – 28.5 million for Great Britain in 2013.

Capgemini Consulting. The Open Data Economy: Unlocking Economic Value by Opening Government and Public Data. Capgemini Consulting. Accessed July 24, 2014. http://bit.ly/1n7MR02

  • This report explores how governments are leveraging open data for economic benefits. Through using a compariative approach, the authors study important open data from organizational, technological, social and political perspectives. The study highlights the potential of open data to drive profit through increasing the effectiveness of benchmarking and other data-driven business strategies.

Deloitte. Open Growth: Stimulating Demand for Open Data in the UK. Deloitte Analytics. December 2012. Accessed July 24, 2014. http://bit.ly/1oeFhks

  • This early paper on open data by Deloitte uses case studies and statistical analysis on open government data to create models of businesses using open data. They also review the market supply and demand of open government data in emerging sectors of the economy.

Gruen, Nicholas, John Houghton and Richard Tooth. Open for Business: How Open Data Can Help Achieve the G20 Growth Target.  Accessed July 24, 2014, http://bit.ly/UOmBRe

  • This report highlights the potential economic value of the open data agenda in Australia and the G20. The report provides an initial literature review on the economic value of open data, as well as a asset of case studies on the economic value of open data, and a set of recommendations for how open data can help the G20 and Australia achieve target objectives in the areas of trade, finance, fiscal and monetary policy, anti-corruption, employment, energy, and infrastructure.

Heusser, Felipe I. Understanding Open Government Data and Addressing Its Impact (draft version). World Wide Web Foundation. http://bit.ly/1o9Egym

  • The World Wide Web Foundation, in collaboration with IDRC has begun a research network to explore the impacts of open data in developing countries. In addition to the Web Foundation and IDRC, the network includes the Berkman Center for Internet and Society at Harvard, the Open Development Technology Alliance and Practical Participation.

Howard, Alex. San Francisco Looks to Tap Into the Open Data Economy. O’Reilly Radar: Insight, Analysis, and Reach about Emerging Technologies.  October 19, 2012.  Accessed July 24, 2014. http://oreil.ly/1qNRt3h

  • Alex Howard points to San Francisco as one of the first municipalities in the United States to embrace an open data platform.  He outlines how open data has driven innovation in local governance.  Moreover, he discusses the potential impact of open data on job creation and government technology infrastructure in the City and County of San Francisco.

Huijboom, Noor and Tijs Van den Broek. Open Data: An International Comparison of Strategies. European Journal of ePractice. March 2011. Accessed July 24, 2014.  http://bit.ly/1AE24jq

  • This article examines five countries and their open data strategies, identifying key features, main barriers, and drivers of progress for of open data programs. The authors outline the key challenges facing European, and other national open data policies, highlighting the emerging role open data initiatives are playing in political and administrative agendas around the world.

Manyika, J., Michael Chui, Diana Farrell, Steve Van Kuiken, Peter Groves, and Elizabeth Almasi Doshi. Open Data: Unlocking Innovation and Performance with Liquid Innovation. McKinsey Global Institute. October 2013. Accessed July 24, 2014.  http://bit.ly/1lgDX0v

  • This research focuses on quantifying the potential value of open data in seven “domains” in the global economy: education, transportation, consumer products, electricity, oil and gas, health care, and consumer finance.

Moore, Alida. Congressional Transparency Caucus: How Open Data Creates Jobs. April 2, 2014. Accessed July 30, 2014. Socrata. http://bit.ly/1n7OJpp

  • Socrata provides a summary of the March 24th briefing of the Congressional Transparency Caucus on the need to increase government transparency through adopting open data initiatives. They include key takeaways from the panel discussion, as well as their role in making open data available for businesses.

Stott, Andrew. Open Data for Economic Growth. The World Bank. June 25, 2014. Accessed July 24, 2014. http://bit.ly/1n7PRJF

  • In this report, The World Bank examines the evidence for the economic potential of open data, holding that the economic potential is quite large, despite a variation in the published estimates, and difficulties assessing its potential methodologically. They provide five archetypes of businesses using open data, and provides recommendations for governments trying to maximize economic growth from open data.

Social Physics

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The quantitative study of human society and social statistics (Merriam-Webster).

When the US government announced in 2012 that it would invest $200 million in research grants and infrastructure building for big data in 2012, Farnam Jahanian, chief of the National Science Foundation’s Computer and Information Science and Engineering Directorate, stated that “big data” has the power to change scientific research from a hypothesis-driven field to one that’s data-driven.” Using big data to provide more evidence-based ways of understanding human behavior is the mission of Alex (Sandy)Pentland, director of MIT’s Human Dynamics Laboratory. Pentland’s latest book illustrates the potential of what he describes as “Social Physics.”

The term was initially developed by Adolphe Jacques Quetelet, the Belgian sociologist and mathematician who introduced statistical methods to the social sciences. Quetelet expanded his views to develop a social physics in his book Sur l’homme sur le developpement de ses facultes, ou Essai de physique sociale. Auguste Comte, who coined “sociology” adopted the term (in his Positive Philosophy Volume Social Physics) when he defined sociology as a study that was just as important as biology and chemistry.

According to Sandy Pentland, social physics is about idea flow, the way human social networks spread ideas and transform those ideas into behaviors. His book consequently aims to “extend economic and political thinking by including not only competitive forces but also exchanges of ideas, information, social pressure, and social status in order to more fully explain human behavior… Only once we understand how social interactions work together with competitive forces can we hope to ensure stability and fairness in our hyperconnected, networked society.”

The launch of the book is accompanied by a website that connects several scholars and explains the term further: “How can we create organizations and governments that are cooperative, productive, and creative? These are the questions of social physics, and they are especially important right now, because of global competition, environmental challenges, and government failure. The engine that drives social physics is big data: the newly ubiquitous digital data that is becoming available about all aspects of human life. By using these data with to build a predictive, computational theory of human behavior we can hope to engineer better social systems.”

Also check out the video below:

Index: The Data Universe

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The Living Library Index – inspired by the Harper’s Index – provides important statistics and highlights global trends in governance innovation. This installment focuses on the data universe and was originally published in 2013.

  • How much data exists in the digital universe as of 2012: 2.7 zetabytes*
  • Increase in the quantity of Internet data from 2005 to 2012: +1,696%
  • Percent of the world’s data created in the last two years: 90
  • Number of exabytes (=1 billion gigabytes) created every day in 2012: 2.5; that number doubles every month
  • Percent of the digital universe in 2005 created by the U.S. and western Europe vs. emerging markets: 48 vs. 20
  • Percent of the digital universe in 2012 created by emerging markets: 36
  • Percent of the digital universe in 2020 predicted to be created by China alone: 21
  • How much information in the digital universe is created and consumed by consumers (video, social media, photos, etc.) in 2012: 68%
  • Percent of which enterprises have liability or responsibility for (copyright, privacy, compliance with regulations, etc.): 80
  • Amount included in the Obama Administration’s 2-12 Big Data initiative: over $200 million
  • Amount the Department of Defense is investing annually on Big Data projects as of 2012: over $250 million
  • Data created per day in 2012: 2.5 quintillion bytes
  • How many terabytes* of data collected by the U.S. Library of Congress as of April 2011: 235
  • How many terabytes of data collected by Walmart per hour as of 2012: 2,560, or 2.5 petabytes*
  • Projected growth in global data generated per year, as of 2011: 40%
  • Number of IT jobs created globally by 2015 to support big data: 4.4 million (1.9 million in the U.S.)
  • Potential shortage of data scientists in the U.S. alone predicted for 2018: 140,000-190,000, in addition to 1.5 million managers and analysts with the know-how to use the analysis of big data to make effective decisions
  • Time needed to sequence the complete human genome (analyzing 3 billion base pairs) in 2003: ten years
  • Time needed in 2013: one week
  • The world’s annual effective capacity to exchange information through telecommunication networks in 1986, 2007, and (predicted) 2013: 281 petabytes, 65 exabytes, 667 exabytes
  • Projected amount of digital information created annually that will either live in or pass through the cloud: 1/3
  • Increase in data collection volume year-over-year in 2012: 400%
  • Increase in number of individual data collectors from 2011 to 2012: nearly double (over 300 data collection parties in 2012)

*1 zetabyte = 1 billion terabytes | 1 petabyte = 1,000 terabytes | 1 terabyte = 1,000 gigabytes | 1 gigabyte = 1 billion bytes

Sources

Index: Participation and Civic Engagement

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The Living Library Index – inspired by the Harper’s Index – provides important statistics and highlights global trends in governance innovation. This installment focuses on participation and civic engagement and was originally published in 2013.

  • Percent turnout of voting age population in 2012 U.S. Presidential election: 57.5
  • Percent turnout in 2008, 2004, 2000 elections: 62.3, 60.4, 54.2
  • Change in voting rate in U.S. from 1980 to most recent election: –29
  • Change in voting rate in Slovak Republic from 1980 to most recent election: –42, the lowest rate among democratic countries surveyed
  • Change in voting rate in Russian Federation from 1980 to most recent election: +14, the highest rate among democratic countries surveyed
  • Percent turnout in Australia as of 2011: 95, the highest rate among democratic countries surveyed
  • Percentage point difference in voting rates between high and low educated people in Australia as of 2011: 1
  • Percentage point difference in voting rates between high and low educated people in the U.S. as of 2011:  33
  • Number of Black and Hispanic U.S. voters in comparison to 2008 election: 1.7 million and 1.4 million increase
  • Number of non-Hispanic White U.S. voters in comparison to 2008 election: 2 million decrease, the only example of a race group showing a decrease in net voting from one presidential election to the next
  • Percent of Americans that contact their elected officials between elections: 10
  • Margin of victory in May 2013 Los Angeles mayoral election: 54-46
  • Percent turnout among Los Angeles citizens in May 2013 Los Angeles mayoral election: 19
  • Percent of U.S. adults that used social networking sites in 2012: 60
  • How many of which participated in a political or civic activity online: 2/3
  • Percent of U.S. social media users in 2012 that used social tools to encourage other people to take action on an issue that is important to them: 31
  • Percent of U.S. adults that belonged to a group on a social networking site involved in advancing a political or social issue in 2012: 12
  • Increase in the number of adults who took part in these behaviors in 2008: four-fold
  • Number of U.S. adults that signed up to receive alerts about local issues via email or text messaging in 2010: 1 in 5
  • Percent of U.S. adults that used digital tools digital tools to talk to their neighbors and keep informed about community issues in 2010: 20
  • Number of Americans that talked face-to-face with neighbors about community issues in 2010: almost half
  • How many online adults that have used social tools as blogs, social networking sites, and online video as well as email and text alerts to keep informed about government activities: 1/3
  • Percent of U.S. adult internet users that have gone online for raw data about government spending and activities in 2010: 40
  • Of which how many look online to see how federal stimulus money is being spent: 1 in 5
  • Read or download the text of legislation: 22%
  • How many Americans volunteered through or for an organization at least once between September 2011 and September 2012: 64.5 million
  • Median hours spent on volunteer activities during this time: 50
  • Change in volunteer rate compared to the year before: 0.3 decline

Sources