Invited Presentation

Geographic Information Systems andApplied Economics:An Initial Discussion of PotentialApplications and Contributions

Richard Taupier and Cleve Willis

Geographic Information Systems (GIS) are becoming increasingly important to virtually all ofthe natural and social sciences. Applied economists will find that GIS can make valuablecontributions to many of the problems with which they are concerned. Moreover, a great dealof the science behind GIS technology would benefit from the contributions of appliedeconomists. This paper presents some initial suggestions for the ways in which GIS may beimportant to economics and the GIS related issues concerning which applied economists couldprovide useful insights.

Introduction

To those of us already caught by the rising tide ofinterest and activity concerning Geographic Infor-mation Systems (GIS) it may seem that there canbe no academic or professional discipline as yetuntouched by its waves. While a healthy skepti-cism toward such movements has kept many of usfrom being entirely swept away in its rip, there areno fewer than five professional associations in theUnited States whose annual meetings are almostentirely devoted to GIS, and it is becoming nearlyimpossible to attend a meeting of natural or socialscientists where GIS is not among the topics ofdiscussion. Statements such as “North America iscurrently experiencing a revolution in the linkingof computer-based Geographical Information Sys-tems (GIS) to planning issues” (Harris and Elmes)are neither uncommon nor seemingly inaccurate.Virtually every academic geography, planning,and natural resource management department hasone or more GIS specialists. Nearly all nationalplanning agencies, every state and province in theUnited States and Canada, and a substantial andgrowing percentage of counties and large and mod-

Richard Taupier is Associate Director of the Office of Geographic hr-fomration and Analysis, Blaisdell House, Box 30t320, University ofMassachusetts, Amherst, MA 01003-0820. Cleve Willis is Professor ofResource Economics, Draper Hall, Box 32040, University of Massa-chusetts, Amherst, MA 01003-2040,

erately sized cities have some GIS capability (Fi-scher & Nijkamp).

Perhaps more than a few of us have expectedthis wave of interest to crest and break, giving wayto calmer reflection on what this technology isabout and what long term role it can play in thedisciplines in which we are schooled. It is the in-tent of this paper to consider what GIS technologymay have to offer to applied economists and whatcontributions applied economists may be able tomake concerning the many issues that surround thegrowing use of GIS. Perhaps then we will be in abetter position to decide whether this rising tide ofinterest in GIS is a natural flow, caused by theattraction of technology and information, that willsoon move into its ebb phase, or the beginning ofa more permanent condition of high tide.

GIS

GIS has been defined in alternative ways; commonground includes the notion that a GIS is a collec-tion of tools and methods for acquiring, storing,managing, transforming, analyzing, summarizingand displaying spatially referenced data for thepurpose of understanding and contributing to thesolution of real world problems (Burrough; Fischerand Nijkamp; Femald). While the general expec-tation is that these tools and methods will be com-puterized, there remain even today elements ofdata collection, interpretation, and analysis that are

Taupier and Willis

visual and manual and yet form essential compo-nents a functional GIS.

The major elements of a GIS are often de-scribed as:

e

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a data base of spatially-referenced, natural andanthropogenic features and associated attri-butes that comprise both spatial and tabulardata elements;computer software to allow for the input, stor-age, retrieval, manipulation, analysis, andoutput of both feature and attribute data;computer hardware and peripherals that workin conjunction with the software to enable allthe listed software functions to occur;an appropriate set of standards, methods, pro-cedures, user interfaces, quality controls, andthe people who apply them; so that the GISproducts can be objectively replicated, mea-sured and evaluated.

With the growing demand for more and bettergeographic information and technology, advanceswithin these four elements of a GIS are occurringat a rapid pace. In the area of data collection, forexample, there have been significant improve-ments, and corresponding cost reductions, in thelast two or three years in the sophistication ofGlobal Positioning Systems (GPS) (a satellite-based radio-wave, point-location technology) andthe recent maturation of digital ortho photography(a digitally-produced, planametrically-accurate,photographically derived image base map). Thesetwo technologies alone may well reduce the timeand cost required for base map compilation to onequarter or one tenth of what it was just a decadeago.

At the same time, continuing reductions in thecost of computer processing capacity and data stor-age and retrieval devices enables the collection,storage, and processing of much larger data sets.Hence, because today’s systems can effectivelyuse data with much greater detail and at higherresolutions, the tendency exists to build data basesthat are far more content-rich than before. Re-sources that are saved due to increased efficiencyof technology are applied to capturing much richerdata.

Many early studies have shown that the mostsignificant costs (70% on average) associated withthe development of a GIS are in the area of database creation. Improved efficiencies in data cap-ture can lead to significant cost reductions. Suchcost reductions can place GIS capabilities withinthe reach of organizations with relatively fewerresources.

Because public agencies continue to be the ma-

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jor purchasers of GIS information and components($8 to $10 billion annually in the United States),government organizations are the most significantsource of resources committed to the developmentof standards, methods, and quality assurance pro-cedures (for both data and products). The federalgovernment, in close association with the aca-demic community through such programs as theNSF funded National Center for Geographic Infor-mation and Analysis (NCGIA) has recently fo-cussed much of its resources on the developmentof national spatial data transfer and metadata (doc-umentation) standards, as well as the creation of aNational Spatial Data Infrastructure (NSDI) pro-gram.

GIS software belongs to a family of spatial datasoftware that includes Computer Aided Design(CAD) software, Automated Mapping/FacilitiesManagement (AM/FM) software, and ThematicMapping software. It is differentiated from themby three functional capabilities: its ability to rec-ognize relative direction and location (topology);the close coupling of graphic (feature) elementswith intelligent data base attributes; the ability toprocess polygons (areas defined by points andlines) through a broad array of boolean operations.

Many commercially available GIS softwareproducts are on the market today. At the high endare those software systems that are fully featuredand require substantial commitments of staff andcomputer time. Such systems cannot be installedor applied on a casual basis; they are not especiallyuser friendly and require significant organizationalresources. Some GIS software systems are de-signed with a particular set of applications in mind,such as those specific to transportation planning orland records management. When a product can befound that optimizes performance around a set offunctions that closely match organizational needs,it is generally a more efficient product. On theother end are an increasing number of lower endpackages that offer many fewer software featuresand may even lack some of the full range of to-pology, data base functions, and polygon process-ing capabilities. Some even have proprietary dataformats or lack data input capabilities which canonly be resolved by experienced programmers. Se-lecting the best GIS software for a particular mixof functional needs and organizational resourcescan be a difficult and time-consuming task.

Uses of GIS

The proceedings of various academic and profes-sional meetings are filled with examples of the

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ways in which GIS technology is being applied.Yet, many of these papers are much the same andfail to provide any critical assessment of the natureand value of the contribution that the GIS made tothe actual problem at hand. Very few papers gen-erally have surveyed the applications of GIS in anybroadly applicable fashion and even those havebeen found to contain some significant omissionsor to be lacking in objectivity. The more importantareas to which GIS is currently being applied in-clude natural resource and land use planning, en-vironmental assessment, protection, and manage-ment, infrastructure management (roads and utili-ties), transportation planning, public health, socialservices delivery, economic development, prop-erty and land records management, facility siting,and marketing.

The natural resource planning agencies haveclearly led the way in the United States in thedevelopment of GIS programs at both the federaland state levels. This is in contrast to the Europeanand Australian experience with GIS in which ca-dastral (land records) systems played the dominantrole. Natural resource agencies have tended to fo-cus their GIS capabilities toward building invento-ries of natural features (wetlands, surface andground water resources, habitat types, soils, andvegetation) and the uses that we make of them(pollution discharges, land use, population distri-bution, water supplies). The primary motivationhas been the prevention or mitigation of conflictinguses and the understanding of causes of environ-mental degradation. These broad inventories of thenatural and built environment have allowed agen-cies to conduct some relatively simple analysessuch as development suitability, facility siting, riskassessment, and habitat designation.

Planning agencies at all levels of government inthe United States are generally viewed as beingamong the primary beneficiaries of GIS (Harrisand Elmes). Planning agencies most often dealwith land, its uses, and the local decisions andregulations that govern them. Much of what plan-ning agencies do involves granting and keepingtrack of permissions to use land in a specific man-ner. Secondarily, planning agencies often partici-pate in decisions about where to place things thatprovide for common needs such as roads, schools,hospitals, fire stations, and waste disposal sites.Sometimes these agencies make plans of a morecomprehensive nature and they must try to opti-mize the use of finite resources, build communityresources that match local preferences, generatealternative scenarios, or model the outcomes ofpossible decisions. Several papers (Harris; Fischerand Nijkamp) have shown that planning agencies

have been quite successful in using GIS to conductthe more basic and routine tasks for which they areresponsible, but are considerably less successful inapplying GIS to more complex tasks such as gen-erating alternative plans and projecting outcomes.

Within the past several years we have witnessedthe release of some small scale yet nationally con-sistent GIS data bases (TIGER, for example) andthe value-added private sector products that theyhave enabled. These products have spurred devel-opment of some social service applications of GISthat would not otherwise have been possible. So-cial service agencies equipped only with the ad-dress of a client can now plot the location of thenearest needed facility or the optimum site for anew service provider. Public health specialists canmore easily locate cases of special interest andmore readily discern patterns of interest. Even thedaily migrations of the homeless in search of foodand shelter are more readily apparent to the GIS-capable.

GIS is an intuitively valuable tool to so manybecause of some of the simple functions it is ca-pable of. Too much information is often availablerelative to any decision and the relevance and ap-plicability of that information can often be unclear.GIS offers the promise of organizing and sortingthrough a very messy world of information, gen-eralizing that information in some suitable fashion,combining it with other information, and produc-ing a graphic output of understandable simplicity.Therein also lies one of the most significant dan-gers to the consumers of GIS products. If beforewe had to contend with the evils of lies, damn lies,and statistics, we must now contend with the evilsof lies, damn lies, statistics, and GIS. False as-sumptions about the quality and integrity of data,inappropriate operations and transformations, andlack of fundamental appreciation for what consti-tutes good science can lead to results that are bothmeaningless and a profound waste of resources.

The Relevance of GIS to Applied Economics

‘‘GIS has become a sine qua non for geographicanalysis and research in government, business, andacademia. ” (Dobson). If, as Dobson and otherwriters suggest, the strength of GIS innovation anddiffusion is that science and society are at the earlystages of technological, scientific, and intellectualrevolution as profound as those initiated by theprinting press or the computer, can its broad andeffective use by applied economists be long de-layed?

Applied economists, like many other natural and

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social scientists, must often use data that are in-herently spatial in nature. They use these data toderive meaningful information and then must ap-ply that information to the type of problem solvingin which they typically engage. We shall considerthe kinds of problems to which GIS technologycurrently lends itself, the analytical functions ofwhich GIS is capable, and the need to extend thecapabilities of GIS beyond their current limits.

We might also reflect on several issues that haveemerged in Massachusetts over the past few yearsto which both GIS and applied economics mighthave made significant contributions:

1. How can the effects of agricultural chemicalson drinking water supplies be minimized?

2. How can natural resource damages under thefederal Superfund statute be assessed andhow might we estimate the economic lossesassociated with those damages?

3. How shall we locate sites with physical anddemographic characteristics that might makethem suitable locations for hazardous wastetreatment facilities?

4. What are the expected benefits of the cleanupof Boston Harbor and Massachusetts Bayand who should bear the costs?

5. How can a no-net-loss policy for wetlands beconstructed and what role should large-scalemapping of wetlands play in that effort?

6. What will be the economic impacts of apply-ing land use controls to protect drinking wa-ter from the effects of non-point source pol-lution?

All of these examples have certain features incommon. They all involve spatial elements, theyinvolve both geographic and demographic repre-sentations, and they are concerned with the valuesthat we place on resources and their use. Whileboth GIS and economics can contribute to eachproblem separately, together the contributioncould be far greater.

Applied economists trade in many of the sameissues as their colleagues in the physical sciences,yet from a rather different point of view. They arenot concerned solely with the locations, qualities,and quantities of resources, but also with how theyare used and valued; not only with the impacts ofrules, regulations, and modifications of the phys-ical landscape, but also the costs or benefits theywill generate.

The analytical capabilities of GIS allow for thediscovery of important spatial relationships amongphysical features and among socioeconomic char-acteristics as well. Among the many analyticalfunctions of GIS are those concerned with database query (for both locational and attribute val-

ues), measurement (classification, distance, area,volume), generation and analysis of surfaces, net-works, and buffers, connectivity (proximity, con-tiguity, spread), nearness, and co-occurrence(overlay). More than 64 such analytical functionshave been identified (Goodchild and Brusgard) andmost are available within the more fully featuredGIS software programs available today. Aronoff(1989) as well as others have used relatively sim-ple classification schemes under which to organizethese many functions.

Most geographic data are representations ofphysical features and most models built using GIStechnology are concerned with the representationof physical space. But virtually all of the analyticalfunctions of GIS can be applied to attribute data aswell, thus allowing for the development of modelsthat represent spatially arranged, socioeconomicphenomena. Couclelis (1991) suggests that thesepredominant absolute (physical) views of geo-graphic space present significant limitations andthat what is needed is the ability to construct mod-els that treat geographic space as relational. Ap-plied economists will find greater utility in the rel-ative or conceptual models that represent the valuethat society places on physical resources and theircharacteristics.

Potential Contributions byApplied Economists

Applied economists could make contributions toboth the science and technology of GIS in at leasttwo primary areas. The first of these is in the ap-plication of GIS to those problems with which ap-plied economists generally concern themselves. Atthe start this will involve learning the mechanics ofGIS technology and discovering to what extent thecurrent capabilities of GIS software can be appliedto problems of an economic nature. The secondinvolves active reflection and understanding of thebroader conceptual issues, including valuation,generated by the growing use of GIS within oursociety.

A great deal of the discussion among the GISresearch community, however defined, is con-cerned with the extent to which current GIS tech-nology is capable of addressing the needs of so-cioeconomic geography and regional science(Couclelis). While numerous writers have sup-ported this general notion that current GIS tech-nology does not yet do justice to the needs of re-searchers and decision makers whose primary con-cerns are with socioeconomic issues, at least oneview is that “If, today, GIS is not valued for its

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analytical strength, the weakness results, not fromlack of GIS capability, but from a lack of will orvision among users.” (Dobson). Dobson continuesin this same paper to assert that “as early as the1970s . . . many pertinent physical and culturalfeatures were simulated through GIS linked witheconometric models, location-allocation models,environmental assessment models, and spatial da-tabases. . . .‘’ We are therefore inclined to agreewith the position that considerably less has beenaccomplished with GIS in the area of socioeco-nomic studies than might have been possible. It isthe appropriate role of applied economists to ex-tend the applications of GIS into the “relative”space of the social scientists through the use ofexisting economic models and the development ofnew ones based on the use of GIS technology.

We will suggest a few of the broader conceptualissues generated by the use of GIS which mightinterest economists. At least two research initia-tives within the program of the NCGIA wouldhave benefitted by further involvement of appliedeconomists; Initiative #4, Understanding the Usesand Assessing the Value of Geographic Informa-tion, and Initiative #9, Sharing Geographic Infor-mation. From the first of these two initiatives haveemerged some early attempts to apply benefit-costanalysis to GIS projects (Dickinson and Calkins).Those initial attempts demonstrated the difficultiesassociated with measuring the non-market benefitsof GIS programs, but did little to resolve the theo-retical issues of what could be considered benefitsand how to measure them. The French economistDidier (1990) has made a significant contributionto this issue of assessing the value of geographicinformation and asserts that all benefits of geo-graphic information are non-market benefits andmust be measured accordingly, A U.S. GeologicalSurvey economist (Gillespie) was among the firstto settle on the use of two categories of benefits,efficiency and effectiveness benefits, that now ap-pear to have earned general acceptance amongthose who concern themselves with this issue.Taupier (1992) summarized the available literatureon the application of benefit-cost analysis to GISand examined the various categories of benefitsproposed by various writers. Smith and Tomlinson(1992) were first to offer measures of willingness-to-pay (WTP) as appropriate to the measurementof the benefits of GIS programs,

In spite of this progress, much remains to bedone in the application of benefit-cost methods toGIS programs. Given the substantial investmentsin public resources now being made in the devel-opment of GIS capabilities, decision makers needstrong reassurances that these investments will

lead to valuable results. While it is often possibleto understand the specific products and outputs ofGIS programs, it can be more difficult to placevalue on those outputs and to determine how toinclude both internal and external benefits in theanalysis, Often, the positive results of GIS pro-grams are expressed as better decisions, reductionof risk, and avoidance of future damages. Closeexamination of these expected positive resultsshows that many are indeed quantifiable by expe-rienced benefit-cost analysts. Continued improve-ments in methods for assessing the value of GISprograms would be welcome.

NCGIA Initiative #9 fostered further discussionof the value of geographic information, this time inthe context of how institutions should behave rel-ative to providing access to geographic informa-tion. Several participants asserted that marginalcost pricing of public sector geographic informa-tion has legal precedence (Onsrud) and that it is themost efficient policy in maximizing social benefits(Taupier). This issue of public access to geo-graphic information is still generating considerableinterest, since many government entities are stillwrestling with issues of how or if they should gen-erate revenue from the sale or licensing of spatialdata. It is a policy issue that has been difficult tosettle for many government agencies in the UnitedStates due to a broader confusion about the role ofgovernment under shifting political and economicphilosophies,

Issues having to do with the value of geographicinformation extend far beyond this concern forproviding public access and designing efficientpricing policies. Agencies are constantly dealingwith issues of the appropriate scale, detail, or res-olution of spatial data sets. We now possess thetechnical sophistication to produce spatial data thatare infinitely accurate and infinitely expensive.While agencies should only be prepared to pay forthose data from which they can generate positivenet benefits, no practical guidance has been of-fered as to how agencies should evaluate the ap-propriate level of detail and expenditure, In somecases natural resource scientists and regulatory of-ficials encourage the development of data at veryhigh resolution even when it is unclear how thatlevel of detail will be used. In many other casesdata are collected that are unfit for many specificapplications because they lack sufficient detail.

Even federal programs designed to build nation-ally consistent data bases often lack clear eco-nomic justification. The national Digital OrthoPhotography program managed by the U.S. Geo-logical Survey has determined that this image basemap will be comprised of one meter resolution

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images regardless of whether that coverage is of adensely developed or topographically complexarea or is of a generally uniform landscape aboutwhich little detail is needed. The result is that fed-eral funds are potentially over-spent in smallerstates that are more densely settled. Such a situa-tion is unnecessary given modem technology anddata base tools that are capable of seamlessly join-ing a mosaic of areas sampled at different densitiesand then generalizing unnecessary detail to presentan image of consistent resolution across a widearea.

We suspect that as readers reflect upon these andother ideas contained elsewhere in this paper thatother potential GIS issues to which economistscould make valuable contributions will occur.

Examples of GIS Applications

We believe that it is useful to present some cases inwhich decision makers might well have benefittedfrom the addition of economic analysis to the GISanalysis conducted on their behalf. In doing so, weindicate how the analysis might have been ex-tended to provide more useful decision-makingaids.

Underground Storage Tanks

In Massachusetts, like many other densely popu-lated areas, there are significant problems withcontamination of drinking water supplies by vola-tile organic compounds (VOCS). It is a widely heldbelief that the major source of VOC contaminantsis leaking underground storage tanks. Indeed, atone time, the U.S. EPA suggested that leakingunderground storage tanks could be the numberone threat to environmental quality and drinkingwater supplies in the United States. There are be-lieved to be over 50,000 underground storagetanks in the state, the majority of which hold pet-rochemicals. It was once estimated that as many as10% of those tanks could have leaks. The Massa-chusetts Department of Environmental Protection(MDEP) decided to develop a program, using GIStechnology, to remove those underground tanksthat appeared to present the greatest risk of con-tamination because of the age and material of thetanks and its proximity to drinking water supplies.

Estimates of the cost of the damages caused byleaking underground storage tanks were never de-veloped even though such costs might be rathereasily calculated based on the removal and dis-posal of contaminated soils and the remediation or

replacement of contaminated water supplies. Costsassociated with the effects on human and ecolog-ical health must also be included where they exist.

Records on the locations of underground storagetanks were in rather poor condition. Permits areissued by local fire departments and a record ofeach permit is filed with the state Department ofPublic Safety. In addition to the lack of standardinformation on the permit forms, however, loca-tional information was found to be substantiallyunreliable.

The MDEP decided to pilot a program in 28municipalities within standard-metropolitan-statistical-areas for which complete address rangeswere available through the U.S. Bureau of theCensus TIGER files and for which records on thelocations of underground storage tanks appeared tobe reasonably complete. The GIS application de-pended upon existing data to show the location ofdrinking water supplies, groundwater aquifers, andeither delineated or interim (half mile buffers)zones of contribution to the water supplies. TheGIS used a function commonly known as addressmatching in which approximate locations of spe-cific properties with known street numbers are in-terpolated from a data base containing street seg-ments and address ranges. Tests later showed thatlocations derived from address matching in thisapplication were accurate within 200 feet.

Each underground storage tank was given aunique numerical identifier that tied it to both astreet address and location and a complete recordshowing age, ownership, materials, and content.Tanks were then prioritized for testing, examina-tion, and removal based on proximity to zones ofcontribution to water supplies, age, and material.

In discussion about the benefits of this GIS ap-plication it was proposed that the value of the re-duction in risk of contamination with VOCS shouldbe based upon the avoidance of costs that would beincurred to remove and dispose of contaminatedsoils and remediate or replace drinking water sup-plies. The benefits associated with reduced risks of;mpacts to human and ecological health were ac-knowledged but regarded as too difficult to mea-sure.

Although the pilot program was regarded suc-cessful, the MDEP chose not to proceed with fullimplementation. The decision was based uponconcerns about the poor overall quality of recordson underground storage tanks and the cost of ob-taining complete address ranges for all Massachu-setts municipalities.

The decision against full implementation was abad economic decision. The cost of complete ad-dress ranges would have been only $10,000 and an

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investment of $100,000 would have allowed fornearly complete reconstruction of undergroundstorage tanks records. The costs avoided by theprevention of even one significant case of VOCcontamination would have exceeded all program-matic expenses.

Watershed Protection

The Boston metropolitan area depends upon drink-ing water supplies from 90 miles west of the city.In order to create this water supply system the statehad to disincorporate and flood four rural commu-nities in the 1930s. Even though the area remainsfairly rural, new standards contained in the recentamendments to the federal Clean Water DrinkingAct would eventually require the construction ofan expensive filtration system. The state chose toinstitute a set of land use restrictions within the 28towns that made up the watersheds to this drinkingwater supply system, The state legislature passedthe law containing those restrictions even though itwas clear that some filtration would still be neces-sary due to the fact that the water supplies passthrough two holding reservoirs with even more sig-nificant water quality problems. The restrictionswere concerned primarily with protection againstnon-point source pollution,

The Massachusetts legislature, in the statute, re-quired the use of GIS to analyze the percentage ofland within the 28 towns that would be affected bythe restrictions and eventually to identify each pri-vate parcel affected and provide data whereby theeconomic losses that could be attributed to the re-strictions could be calculated and individual land-owners compensated. The GIS application wasgenerally successful in estimating the land area af-fected by the restrictions. The GIS functions usedincluded the buffering of tributaries and reservoirsand an overlay analysis of current land uses.

Some problems were encountered when it be-came clear that the available data were at a scale of1/100,000 with estimated accuracies of plus or mi-nus 160 feet. At that scale it is possible to assessonly general and not specific impacts. Neither thestate legislature nor private property owners werecontent with such a general assessment of impactsand the legislature chose to fund the developmentof all necessary data at first at 1/25,000 scale andeventually at 1/5,000. At the largest of these scalesit is quite feasible to show property boundaries,stream locations and buffers in sufficient detail toassess the impact of the restrictions on each parcel.With that information the responsible agency ex-pects to be able to provide adequate compensationto land owners.

It is unfortunate that the early application of GISto this issue did not include an estimate of theeconomic costs associated with the proposed landuse restrictions. Data to support such an economicimpact assessment were readily available. The es-timated cost of those impacts could have been eas-ily compared to the estimated costs of filtrationwithout land use restrictions and hence provideguidance to the legislature as to which was themore efficient course of action. A second oppor-tunity was lost when the legislature had to decideon the total funds to be appropriated to compensateland owners for their losses. Again, the addition ofeconomic analysis would have guided policy mak-ers toward an appropriate level of funding. It isunfortunate that at no point in the process was theGIS analysis taken beyond the creation of an in-ventory and the measurement of physical impacts.

Eastern Equine Encephalitis

The residents of southeastern Massachusetts mustperiodically deal with the outbreak of a deadly en-vironmentally borne virus called eastern equine en-cephalitis. This virus is always present in certainspecies of birds known to nest in wetlands. Thevirus is spread among the bird population by mos-quitoes that feed only on avian hosts. Yet, everyseven years or so this virus spreads beyond the birdpopulation and affects horses and humans, towhom it is generally fatal. The state Department ofPublic Health (DPH) constantly monitors mosqui-tos in southeastern Massachusetts for the presenceof the virus and if it is detected and then results inseveral horse cases or a single human case theyrecommend the broad aerial application of generaluse pesticides (malathion) to reduce the mosquitopopulation and the risk of transmission. While theDPH can measure the effects of the pesticide ap-plications on the mosquito population it cannot as-sess its ability to reduce risk of transmission. Pub-lic reaction to warnings of eastern equine enceph-alitis risk generally demand action on the part ofthe DPH.

The use of malathion has many negative effectsas well. Many other beneficial insects are killed asare certain species of fish should sufficient con-centrations of malathion drift onto lakes andstreams, The public is nearly as unwilling to acceptthese environmental damages from the applicationof pesticides as they are unwilling to accept therisk of exposure to encephalitis. In 1991, the DPHand the Office of Environmental Affairs becamedetermined to seek a less damaging approach to thecontrol of mosquitos that might carry the virus.The approach adopted carried all the elements of a

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geographically extensive application of integratedpest management techniques and it depended heav-ily on the use of GIS technology. A fairly largeinterdisciplinary group of scientists were assem-bled to compile everything that was known aboutthe virus, its hosts, and its transmission vectors. Itwas decided that one of four species of mosquitosmust be considered the primary vector for trans-mission of the virus from birds to humans. The lifecycle and habitat requirements of that species werecarefully examined and it was determined that thisspecies of mosquito was susceptible to control us-ing a biological agent known as Bti as long as themosquito larvae could be treated within 7 to 10days of hatching. It was also known that signifi-cant hatches of these mosquitos occurred only aftera period of significant rainfall and that the adultmosquitos bred only in a rather limited type ofwetland habitat.

The use of GIS technology was important inseveral respects. First, it allowed for analysis ofthe adequacy of the spatial sampling regime ofmosquito populations and the subsequent displayof sampling results. Secondly, when the virus wasdetected within the mosquito population, it al-lowed for analysis of the geographic distribution ofthe virus. Third, it allowed for the monitoring ofconditions that could result in a significant hatch ofmosquitos that could serve as vectors for the virus.The use of GIS also permitted the mapping of allsuitable breeding habitats for the vector species.Finally, should all the necessary conditions occurfor a potential outbreak, it allowed for interventionto be targeted to those specific areas where allconditions were present.

The approach proved successful. Bti was ap-plied following a hurricane that deposited severalinches of rain in an area where the virus wasknown to be present. No use of malathion waswarranted and the Bti application killed over 80percent of the larval mosquitos present. The stateconsiders the intervention to have been necessaryand successful and the broad environmental im-pacts of previous control measures were avoided.Even the cost of control was less since the appli-cations of the more expensive Bti were localizedby the effective use of GIS.

Groundwater Protection

Studies of the effects of land uses on environmen-tal media such as groundwater are prime candi-dates for the use of GIS technologies. One recentexample is provided by the work of Iannazzi et al[1994], who sought to quantify the relationship

between groundwater contamination by nitrates,sodium and volatile organic compounds (VOCS)and, among other factors, land uses in the bufferarea surrounding municipal wells. Data on waterquality tests for all municipal wells in Massachu-setts were geographically referenced and land uselayers were digitized for the entire state using theresults of aerial photographs.

With well buffers defined as the area within one-half square mile of the wellhead, it was a straight-forward procedure with GIS software to create adatabase in which each case is assigned a depen-dent variable value, the level of observed contam-inant in a particular wellhead, and values of a setof explanatory variables including the percentageof the buffer area represented by the contaminant-contributing land uses and other site-specific fac-tors, Armed with the sample of hundreds of obser-vations, it was straightforward to estimate loadingfunctions for nitrate and sodium contamination us-ing least squares procedures, and VOC contami-nation likelihood using logistic regression.

With these loading functions made possible byGIS technology, one can approach environmentalpolicy-making with greater sophistication than pre-viously possible. We are made more aware thatgood policy for these problems needs good infor-mation as well as intelligent analysis. And that anoverly simple framework may lead to a rather un-pleasant form of surprise, and counter-productiveresults.

For example, the most common policy to protectgroundwater in a wellhead protection area is tozone to restrict certain land uses thought to con-tribute to a particular form of contamination. Ag-ricultural practices are known to contribute to ni-trate contamination for example, and policy mak-ers at state and local levels have proposed therestriction of intensive agricultural land uses inthese protection areas. The surprise that may awaitis clear from the results of the estimated loadingfunctions. If the restriction leads to a substitutionof medium density residential land use for inten-sive agricultural production, for example, a con-tradictory result obtains. Nitrate contaminationwould rise rather than fall, because the nitrateloading coefficient for this land use is larger(roughly double) than that of agriculture. Thismuch was shown by Harper, Goetz and Willis[1992].

But it is more complicated than that, When thepolicy framework is broadened to consider all con-taminants simultaneously, the potential for sur-prise is magnified. Mansager and Willis [1994]describe cross-contaminant transfers and show thatfor the same policy scenario mentioned above, not

148 October 1994 Agricultural and Resource Economics Review

only would the nitrate levels rise, but the sodiumlevels and the likelihood of VOC contaminationwould as well. It is a conundrum associated withenvironmental policy generally, and recognizedearly by Lave [1984], but it has not yet been fullyunderstood or appreciated by policy-makers, AndGIS technologies can be useful in helping to pro-vide the information base needed to avoid thesesurprises.

Sparco and Mackenzie [1994] report a similaruse of GIS at these very meetings. Their analysisinvolves estimation of a nitrate loading functionfor counties in Delaware. They use private ratherthan public wells as their unit of analysis. And theyhave well depth geographically referenced so thatit is a simple matter to define the radius of thebuffer area around the wellhead as a function ofwell depth. Indeed, as many alternative areal def-initions of zones of contribution to wells as onewould like can simply be evaluated using GIStechnologies. This is indeed, a large advantage ofthat technology.

Conclusions

The tides of interest in GIS are not soon likely tosubside. Rather, we need to redesign our harborsbetter to exploit a new, and rather permanent andbountiful, sea level. As this technology becomesmore familiar, its use will broaden and deepen inapplied economics. For first users, it will ratherimmediately enrichen the data available and en-able, in some cases, questions to be explored em-pirically that would otherwise not have been pos-sible. In others, it will allow applied economists tobe more precise in their conclusions.

But just as GIS can be of substantial value toeconomic research, applied economists can be ofconsiderable service to decision makers who useand manage these data bases. Economic value ofinformation analyses should drive decisions aboutthe appropriate scale, detail and resolution of spa-tial data. Surely, a single scale applied to a broadarea with quite different levels of complexity canhardly be economically efficient.

And questions surrounding policies on publicsector pricing of geographic information, and gen-eration of revenue from the sale or licensing ofspatial data, are clearly awaiting good economicinput. How should institutions and agencies pro-vide access to expensively acquired geographic in-formation?

Clearly applied economists have much to gain inadopting GIS, and in turn they have much to offer

in applying economic principles to the design, pro-vision, and pricing of GIS data bases.

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