Open Data Makes for Sound Economic Policy

August 5, 2013

By: Jordan Kranzler

We’ve made it very clear before that open data brings accountability and transparency to San Francisco government, but those aren’t the only reasons to increase access to city information and make San Francisco the first city 2.0. Open data brings along with it a host of economic benefits.

Spurring Growth by Giving Businesses Data Access

We’ve made it very clear before that open data brings accountability and transparency to San Francisco government. But those aren’t the only reasons to increase access to city information and make San Francisco the first city 2.0 – open data brings along with it a host of economic benefits. In the early 2000s, weather data became open to the public. Consequently, a wide array of startups and commercial weather companies began to form an industry worth between $400-700 million a year that currently employs 4,000 people.  Developments like this have helped elected officials realize that when they adopt open data policies, new companies develop that use the data to help peoples’ lives. Recently, President Obama issued an executive order that released more government data online to spur entrepreneurship and create jobs.

In San Francisco, there is no shortage of social entrepreneurs whose businesses function on open data to improve peoples’ lives and increase civic engagement. Examples include developers of iPhone apps such as Neighborhood Score and SFPark who make business off of bringing government data closer to citizens. Elsewhere in California, the San Diego-based startup BrightScope employs labor and regulatory data in order to advise people on their 401(k) plans. BrightScope has grown from two people at its 2008 inception to having 30 employees and generating approximately $2 trillion in the year 2010.

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Advocating for Economic Success in Low-Income Neighborhoods

Some have pointed out that, while the open data movement has obvious merits, it leaves out low-income communities that are mired by the digital divide – communities that, in many cases, have the most to gain from this information. In Chicago, the Smart Communities program is starting a new campaign titled Smart Communities – Pushing Government Open that it has described as “Open Gov for the Rest of Us.”  This innovative new program seeks to increase Internet access in five low-income Chicago neighborhoods. It teaches community members how to access existing government data sets and then advocates for the City of Chicago to release more data that could improve the economic well-being of low income, minority Chicagoans, including foreclosure information at clearer data about local schools.

Proof in Numbers: Open Data Saves City Costs

And the numbers show! In 2011, the European Commission released a study where it predicts opening up public data would create economic gains of €40 billion (roughly USD $50 million) a year.

In June of 2012, San Francisco Chief Innovation Officer Jay Nath announced that by publishing real-time transit data, there were 21.7% fewer calls to SF 311, the city government’s call service that answers questions about Muni. This saved San Francisco over $1 million per year – money that be invested in places such as public education or put toward the city’s improving but not yet fixed budget situation.


Why do you think San Francisco should have an open data policy? Send us your ideas at info@resetsanfrancisco.org.
 

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