Growth out of the blue: nightlight and economic activity

Measuring GDP is especially challenging in developing countries, where the informal sector is large and institutional constraints can be severe. As a result, GDP growth estimates are often met with skepticism. But new technologies offer an opportunity to improve matters. Luminosity observed from satellites has been shown to be a good proxy for economic activity, and methodologies have been developed in recent years to predict GDP over time and across space based on nightlight intensity. In South Asia's case, GDP predicted using these methodologies closely tracks National Accounts GDP at the aggregate level, and provides a granular picture of GDP at subnational levels. Nightlight intensity also yields new insights on recent economic developments. Thus, the major shocks experienced by Nepal in 2015 had very different impacts across districts. In Afghanistan, local surges in conflict reduced local growth for up to one quarter. And in India demonetization had a short-lived effect at the aggregate level, but a noticeable impact on rural, unbanked and informal districts. To improve economic measurement in South Asia, a greater reliance on big data may help, but a clear agenda toward stronger statistical systems is a necessity.

  • Dr. Martin Rama, Chief Economist for the South Asia, World Bank
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  • 2018-03-14

Cross-Market Integration and Sabotage

"Sabotage" includes a set of firm-specific, non-price related actions negatively influencing competitor's outcomes. There are a large number of potential sabotage options available to integrated firms in direct competition with their non-integrated rivals. For example,

When Google acquired YouTube in 2006, a key word search for YouTube videos provided better results when using Google Chrome as compared to Microsoft Bing. In addition, within its own search process, Google favors YouTube video links over Vimeo links.

The 2011 merger of Comcast and NBCUniversal resulted in some exclusive content on NBC Universal only being offered to Comcast subscribers. Further, these same subscribers not only experienced higher download speeds for content hosted by NBCUniversal as compared to content hosted by CBS, but they also did not face a reduction in monthly quotas for data packets for streamed content from NBCUniversal while this was not the case for data packets for streamed content from CBS.

After Microsoft's acquisition of LinkedIn in 2016, it was observed that LinkedIn's app integrated directly with Windows 10 while this was not the case with other OS, and Microsoft's mobile operating system did not support Facebook integration while that was not the case for LinkedIn.

  • Prof. Asoo J. Vakharia, Warrington College of Business Administration, University of Florida
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  • 2018-03-14

A spatial hedonic analysis of the value of groundwater to agriculture

Groundwater provides many valuable services to society, especially as a source of irrigation water. However, over-extraction and degradation threaten the ability of many groundwater systems to continue to provide such valuable services to society. Information on the benefits of maintaining these resources, or the damages associated with further degradation, can be helpful in managing these resources. Using a rich data set of parcel-level characteristics and a spatial hedonic valuation model, this research highlights the role of groundwater quality and depth in influencing the estimated value of groundwater to irrigated agriculture. The general conclusions of this research, which can be applied to other regions globally, are water is a differentiated product and that there are several pathways in which it can influence agriculture, including changes in levels, variability and quality.

  • Dr. Monobina Mukherjee, Senior Water Resources Analyst, California
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  • 2018-03-08