Costs and Benefits of Data Provision
In 2011 ANDS commissioned the Centre for Strategic Economic Studies at Victoria University to examine the costs and benefits of public sector organisations making their Public Sector Information (PSI) data freely available. The study involved a number of public sector agencies, each suggesting different benefit:cost ratios (all were positive, with the factor ranging from approximately 5 to 20). Overall, the study did demonstrate that the benefits outweigh the costs by some considerable margins, meaning the case for making PSI freely available is strong. Importantly, these are not one-off figures, they are annual and ongoing, and so the benefits accrue.
The full report is here: Costs and Benefits of Data Provision: Report to the Australian National Data Service [PDF 1.61MB]
Related resources: Open Research Data report.
2. A closer look
The study was undertaken by Professor John Houghton, a prominent economist and researcher in the 'open access' field. What characterises this report as being different from some previous efforts, is that it is focused on the costs and benefits to the organisation, the users and the wider benefits to the economy, separately, and collectively.
Symbolically, the study can be represented as shown below:
By using time series of real agency data, Professor Houghton was able to model the costs and benefits, as per the figure, before and after the decision to freely publish was made; having such data either side of the decision makes it possible to estimate the value of free data decision, rather than other factors such as growth or decline in demand. He was also able to model the savings to users and estimate the wider benefits to the economy, which include factors like multiple and sequential use (and re-use) of data.
The study involves a number of agencies, each suggesting different benefit:cost ratios (but all positive). Professor Houghton stresses that the ratios themselves should not be compared, because they reflect more the nature of the underlying data rather than the agencies involved, a caveat which is most important. That said, the study does demonstrate that the benefits outweigh the costs by some considerable margins, meaning that the case for making PSI freely available is strong. Importantly, these are not one-off figures, they are annual and ongoing, and so the benefits accrue.
Download the full text of Costs and Benefits of Data Provision: Report to the Australian National Data Service [PDF 1.61MB] by Professor John Houghton, ANDS, 2011. For further information please contact: email@example.com
You might like to download this presentation [PDF 260KB] on the Cost Benefit Study given at eResearch Australasia, held in Melbourne in November, 2011.
The Economic Impact of Open Data: What Do We Already Know?
This article from the Huffington Post in November 2015 summarises the economic arguments for Open Data and includes four other reports.
|Date||Study||Scope||Benefit of open data
|2011||EU Commission||Europe (public sector data only)||1.5|
|2013||Shakespeare||UK (public sector data only)||0.4|
|2014||Lateral Economics||G8 countries||1.1|
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