Assessing Investment in Future Landsat Instruments: The Example of Forest Carbon Offsets
31 Pages Posted: 27 Mar 2010
Date Written: March 22, 2010
We extend the theory of quality-adjusted expenditure indices to estimate benefits from public investment. In particular, we model the selection of new instruments (in the form of remote-sensing devices) to enhance the longest-operating U.S. satellite-based land-observing program, Landsat. We then apply the model to the use of Landsat in measuring global forest carbon sequestration. Improving measurement of the role of forests in storing carbon has become a prominent concern in climate policy. By characterizing the value of Landsat data in forest measurement, the expenditure function allows us to help inform public investment decisions in the satellite system. The expenditure function also makes explicit the sensitivity of the selection of instruments for the satellites to the value of Landsat information, thus linking instrument choice explicitly to policy design.
Keywords: value of information, satellite data, forests, carbon, sequestration, Landsat
JEL Classification: Q, Q2, O3
Suggested Citation: Suggested Citation