I will discuss briefly here how the fuel of any big data system, source data, can receive the needed attention, from an economic modelling perspective.
Interested readers are referred to:
Naturally, big data systems are engineered as Information Technology solutions, with the associated cost engineering, on a project by project basis. My assumption is that as big data becomes pervasive, the re-use of data and sharing across multiple use ranges, will make a lot of sense, and let the suppliers and users benefit from economies of scale and critical mass effects.
QUESTION 1: THE VALUE of data
The first question to ask is about the value: are these data I am using of value? What is the value of the data I have extracted? What would be the value of additional data, and where could I get them?
Economists following in the steps of Adam Smith distinguish two types of value:
- the value of use
- the exchange value
Obviously, a good which you need for a certain purpose, has a use value to you. If you are thirsty, you need water, for instance.
As for the exchange value, this is a good which you can sell, or buy, because it is traded, and comes with a price on a market. For instance cocoa was an asset used as money in Precolombian civilisation of Latin America. The classical example is diamond.
For data, let us give examples in each of these two categories of value:
An automated system, supervised from a Control Room (say a train network, an electrical grid, a telecommunication network) uses for its own purpose industrial data. This data has an obvious use value, however the data owners seem to be little keen on releasing such data, even for a price, to third parties. This data use case is perceived to fit under a dominant "value of use" and not any identified "exchange value" yet.
An entertainment content such as a movie, materialises (virtually :) ) as a file, which is a data-set. It has an exchange value: rights are sold to cinemas, TV channels, and end users, for viewing this content. In package media form (Bluray, DVD), it can be resold even, by consumers.
Naturally there are many more questions regarding "big data economics" and leading "towards data market places". The following book I have published recently on Amazon/Kindle Editions addresses some...