Using global positioning systems in household surveys for better economics and better policy

Distance and location are the important determinants of many choices that economists study. Economists often rely on information about these variables that is self-reported by respondents in surveys, although information can sometimes be obtained from secondary sources. Self-reports are typically used for information on distance from households or community centers to roads, markets, schools, clinics, and other public services. There is growing evidence that self-reported distance is measured with error and that these errors are correlated with outcomes of interest. In contrast to self-reports, global positioning systems (GPS) can determine location within 15 m in most cases. The falling cost of GPS receivers makes it increasingly feasible for field surveys to use GPS to more accurately measure location and distance. This article reviews four ways that GPS can lead to better economics and better policy by clarifying policy externalities and spillovers, by improving the understanding of access to services, by improving the collection of household survey data, and by providing data for econometric modeling of the causal impact of policies. Several pitfalls and unresolved problems with using GPS in household surveys are also discussed.