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The Value of Luminosity Data as a Proxy for Economic Statistics

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Abstract

One of the pervasive issues in social and environmental research has been to improve the quality of socioeconomic data in developing countries. Because of the shortcoming of standard data sources, the present study examines luminosity (measures of nighttime lights) as a proxy for standard measures of output. The paper compares output and luminosity at the country levels and at the 1° x 1° grid-cell levels for the period 1992-2008. The results are that luminosity has very little value added for countries with high-quality statistical systems. However, it may be useful for countries with the lowest statistical grades, particularly for war-torn countries with no recent population or economic censuses. The results also indicate that luminosity has more value added for economic density estimates than for time-series growth rates.

Suggested Citation

  • Xi Chen & William D. Nordhaus, 2010. "The Value of Luminosity Data as a Proxy for Economic Statistics," Cowles Foundation Discussion Papers 1766, Cowles Foundation for Research in Economics, Yale University.
  • Handle: RePEc:cwl:cwldpp:1766
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    File URL: http://cowles.yale.edu/sites/default/files/files/pub/d17/d1766.pdf
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    References listed on IDEAS

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    1. Simon Kuznets, 1934. "National Income, 1929-1932," NBER Books, National Bureau of Economic Research, Inc, number kuzn34-1, June.
    2. Johnson, Simon & Larson, William & Papageorgiou, Chris & Subramanian, Arvind, 2013. "Is newer better? Penn World Table Revisions and their impact on growth estimates," Journal of Monetary Economics, Elsevier, vol. 60(2), pages 255-274.
    3. Sutton, Paul C. & Costanza, Robert, 2002. "Global estimates of market and non-market values derived from nighttime satellite imagery, land cover, and ecosystem service valuation," Ecological Economics, Elsevier, vol. 41(3), pages 509-527, June.
    4. J. Vernon Henderson & Adam Storeygard & David N. Weil, 2012. "Measuring Economic Growth from Outer Space," American Economic Review, American Economic Association, vol. 102(2), pages 994-1028, April.
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    Blog mentions

    As found by EconAcademics.org, the blog aggregator for Economics research:
    1. Luminosity as an indicator of economic activity
      by Economic Logician in Economic Logic on 2010-09-30 22:38:00
    2. Ritchie asks
      by Tim Worstall in Tim Worstall on 2010-10-01 14:47:40

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    Cited by:

    1. Lu, Heli & Liu, Guifang, 2014. "Spatial effects of carbon dioxide emissions from residential energy consumption: A county-level study using enhanced nocturnal lighting," Applied Energy, Elsevier, vol. 131(C), pages 297-306.
    2. Michalopoulos, Stelios & Papaioannou, Elias, 2010. "Divide and Rule or the Rule of the Divided? Evidence from Africa," CEPR Discussion Papers 8088, C.E.P.R. Discussion Papers.
    3. Bros, Catherine & Couttenier, Mathieu, 2015. "Untouchability, homicides and water access," Journal of Comparative Economics, Elsevier, vol. 43(3), pages 549-558.
    4. Dimico, Arcangelo, 2013. "Size Matters: The Effect of the Scramble for Africa on Informal Institutions and Development," MPRA Paper 54550, University Library of Munich, Germany, revised 18 Mar 2014.
    5. Jerven, Morten, 2014. "African growth miracle or statistical tragedy? Interpreting trends in the data over the past two decades," WIDER Working Paper Series 114, World Institute for Development Economic Research (UNU-WIDER).
    6. repec:bla:obuest:v:79:y:2017:i:3:p:291-318 is not listed on IDEAS
    7. Castelló-Climent, Amparo & Chaudhary, Latika & Mukhopadhyay, Abhiroop, 2015. "Tertiary Education and Prosperity: Catholic Missionaries to Luminosity in India," IZA Discussion Papers 9441, Institute for the Study of Labor (IZA).
    8. repec:kap:jecgro:v:22:y:2017:i:2:d:10.1007_s10887-016-9139-2 is not listed on IDEAS
    9. Michael Wurm & Hannes Taubenböck & Jan Goebel & Stefan Dech & Gert G. Wagner, 2010. "Menschen zählen aus dem All. Möglichkeiten und Grenzen von Satellitendaten zur Abschätzung der Bevölkerungsentwicklung und des Gebäudebestandes in deutschen Städten," Working Paper Series of the German Council for Social and Economic Data 155, German Council for Social and Economic Data (RatSWD).

    More about this item

    Keywords

    Luminosity; Proxy variable; Measurement error in GDP; Gross grid-cell product;

    JEL classification:

    • E01 - Macroeconomics and Monetary Economics - - General - - - Measurement and Data on National Income and Product Accounts and Wealth; Environmental Accounts
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
    • Q4 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy

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