The IPL newsletter: Volume 21, Issue 428

Measuring the Economic Value of Data and Cross-border Data Flows

David Nguyen and Marta Paczos, OECD
The amount and variety of data that companies collect, aggregate and analyze has increased dramatically in recent years. This paper investigates how the economic value of data can be conceptualized and measured from a business perspective. It discusses data monetization as a strategy for developing new business models or enhancing traditional ones, and proposes a new taxonomy for data that focuses on measuring its business value. The paper also discusses how different data characteristics and types affect economic value, before examining the role of cross-border data flows as a key enabler of our global economy. As part of this discussion, the concept of a “global data value chain” is presented, based on the idea that digitalization enables the physical detachment of data collection, analysis, storage and monetization. The paper concludes with a summary and discussion of the most promising avenues for measuring the economic value of data.

What to Expect from Biden-Harris on Tech Policy, Platform Regulation, and China

Darrell M. West and Nicol Turner Lee, Brookings
This article explores what the Biden-Harris combination will mean for technology policy, internet platform regulation, emerging technologies like artificial intelligence (AI), and relations with China. The authors note how previous statements from Biden and Harris “may form the basis of a new policy regime for the technology sector that shifts the prevailing guardrails in meaningful ways. Biden-Harris administration is likely to move towards greater regulation of the technology sector. That includes stronger action on competition policy, antitrust enforcement, privacy policy, cybersecurity, and Section 230 reforms.”

Subsidy Entrepreneurs: an Inquiry into Firms Seeking Public Grants

Anders Gustafsson, Patrik Gustavsson Tingvall & Daniel Halvarsson, Journal of Industry, Competition and Trade
This paper studies the incentives and characteristics of firms that apply for, and eventually receive, one or multiple governmental grants intended to stimulate innovation and growth. The analysis departs from a contest model in which entrepreneurs are free to allocate their effort between production and seeking grants. The results suggest that highly productive entrepreneurs abstain from seeking grants, moderately productive firms allocate a share of their effort to grant seeking, and low-productivity firms allocate most resources to seeking grants. Due to their efforts in seeking grants, these low-productive subsidy entrepreneurs also have a relatively high probability of receiving the grants. Using comprehensive data over grants from the three largest grant-distributing agencies in Sweden, the authors find concordant evidence of a negative relation between the probability of receiving a grant and firm productivity. This negative relation becomes more pronounced for multiple-grant-supported firms.

Autonomous Vehicles, Mobility, and Employment Policy: The Roads Ahead

John Leonard, David Mindell, Erik Stayton, MIT Task Force on Work of the Future
This research brief considers the current state of automated driving technologies, including driver assistance systems and highly automated vehicles (AVs), as well as their potential implications for mobility and employment. Broader impacts, including the interplay with transit and land-use and environmental consequences are also briefly considered. The authors note that “analysis of the best available data suggests that the reshaping of mobility around automation will take more than a decade” and that “fully automated driving will be restricted to limited geographic regions and climates for at least the next decade.”

KEY FINDINGS:

• The widespread deployment of fully automated driving systems that have no safety driver onboard will take at least a decade. Winter climates and rural areas will experience still longer transitions.
• Expansion will likely be gradual and will happen region-by-region in specific categories of transportation, resulting in wide variations in availability across the country.
• The AV transition will not be jobless. New opportunities will arise for employment, such as in the remote management of vehicles, but the quality of these jobs is uncertain, and depends somewhat on policy choices.
• AV should be thought of as one element in a mobility mix, and as a potential feeder for public transit rather than a replacement for it. However, unintended consequences such as increased congestion remain risks.
• AV operations will benefit from improvements to infrastructure, which can create positive spillover effects with respect to jobs, accessibility, and the environment. This includes not only traditional transportation infrastructure such as roads and bridges, but also information infrastructure such as communications systems, databases, and standards.

POLICY RECOMMENDATIONS:

• Investing in local and national infrastructure and public-private partnerships will ease the integration of automated systems into urban mobility systems.
• Sustained investments in workforce training for advanced mobility will help drivers and other mobility workers transition into new careers that support mobility systems and technologies. These areas include software, robotics, testing, electrification, vehicle-to-infrastructure communications, and human-machine interaction.
• Dramatic improvements in mobility safety and access should be pursued, with the aim of reducing traffic fatalities and injuries by several orders of magnitude in the coming decades, while also ensuring access for elderly and disabled passengers.
• Increased federal investment in basic research in the technologies that underpin automated mobility will enhance U.S. competitiveness; these include human-machine interaction, robust perception, prediction and planning, and artificial intelligence.