Geographic Information as an Economic Good

Alenka Krek (2006): Geographic Information as an Economic Good In: GIS for Sustainable Development, Michele Campagna, CRC Press Taylor & Francis Group, 2006

Geographic information is an intangible economic good determined by the high fix cost of production and low marginal cost of reproduction. Its characteristics and the properties of the geoinformation market cause difficulties in applying neoclassical economic principles of pricing to geoinformation. We present cost based pricing that is still used by many data providers and value -based pricing. Value based pricing is pricing according to the value the buyer attaches to the characteristics of the product. It represents an alternative approach in pricing of geoinformation and is generally independent of the geoinformation production cost.


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