Information Technology and Economics for Sustainable Development

 

Jon D. Erickson and John M. Gowdy

Department of Economics

 

Rationale

This proposal marks a giant step forward in bringing information technology (IT) fully into the Economics Department's curriculum and research program.  We propose an investment in an IT-Economics computer laboratory, infrastructure for large enrollment laptop economics courses, development of laboratory and teaching materials for incorporating geographical information systems (GIS) analysis, and an IT-intensive course in regional economics.  This investment will merge four areas of strategic promise: the IT-Economics undergraduate degree, the economics of technology and structural change, regional economic development, and GIS economic and demographic analysis.  The upgrade of our existing computer laboratory will include GIS and regional economic databases, and connectivity to any campus laptop class through a central server.  We modestly anticipate attracting 5 to 15 new IT-Economic students per year over the next four years.  Return on investment is in the range of 55-65% per year.  Creating laptop connectivity to our department archives of data and software, together with the development of GIS lab material, will benefit many of the courses in the campus-wide IT curriculum.  This investment will also contribute to a major department grant-writing campaign in the area of "Regional Economic Information Systems for Sustainable Development" and increase the visibility of our undergraduate and graduate program through community ecological-economic development projects.

 

Information Technology and Economics in the Classroom

The widespread availability of techniques such as GIS mapping and regional input-output analysis is beginning to revolutionize economic analysis.  This information revolution has the potential to revitalize economic analysis and our basic understandings of how the economic system works.  As the information revolution penetrates the classroom, courses will increasingly be taught around local, national, and regional databases.  For instance, in our proposed IT-intensive regional economics course students will not only have the opportunity to learn to manipulate existing databases, they will also learn to collect, analyze, and systematically organize local economic data.

A particularly innovative focus of our department is structural economics, a descriptive system based on input-output analysis which gives a concise view of economic activity and the interconnections between economic sectors, household characteristics and the surrounding environmental/natural resource base.  Rensselaer graduates in Information Technology and Economics will gain hands-on experience in economic analysis and the application of information technology to community economic and environmental planning.  Students will have a variety of career options ranging from the business sector, to local governments and local development agencies, to world-wide economic development and environmental conservation organizations.

To integrate information technology, GIS coursework, and the Rensselaer laptop initiative fully into the IT-Economics bachelor's of science and ongoing research, the department requires investment in our existing computer laboratory, a large enrollment laptop introductory economics class, an IT-intensive regional economics course, and GIS teaching materials.

 

The Economics Department Computer Laboratory

The economics computer laboratory was originally created with the assistance of a strategic investment grant for our graduate program in ecological economics.  The return on this investment has been high.  The program has grown to a world-renowned graduate program, attracting diverse students and scholars from around the world.  Last year’s class totaled 15 full-time and 12 part-time students, with over $170,000 of outside funding support.

The computer lab has also played a growing role in our undergraduate program.  We are building the capacity for a world-class IT and Economics degree, and are finding the current laboratory to be limiting.  We’ve been able to use outside funding and corporate donations to acquire significant software and data needs.  For instance, the Economics department has been an active participant in structuring a partnership and software donation with MapInfo, Inc.  MapInfo donated the most recent GIS software to the Economics department this past semester, and we’re now discussing the development of an extensive database of regional GIS files.  We now need a strategic investment to update the lab’s hardware components to service computer-intensive coursework, graduate research, and undergraduate projects.

In addition, the department is positioning itself to fully participate in Rensselaer’s laptop initiative.  This investment would consist of 6 laptops for our graduate teaching assistants, a server and color printer for the economics computer laboratory, and continued acquisition of software licensing agreements and databases.  The server will be the key to laptop classes developed in the department over the coming semesters.  The server will host the department’s extensive software collection and database which will be accessible by laptop from any on-campus terminal.  Laptop connectivity will be central to a number of computer lab-intensive courses in the Economics Department.  These include Introductory Economics, Managerial Economics, Quantitative Analysis, Econometrics, Natural Resource Economics, Economics of Information, and Regional Economic Analysis.  The lab will continue to be critical to the graduate program and current empirical analysis of local economies, and laptop connectivity will be paramount to further developing the IT-Economics degree and laptop economics courses.

 

The Regional Economics Course and Structural Economics

This Fall 1999 course will combine the economic theory of regional economies with analyses of local communities.  Students will work closely with local communities in developing a semester-long research project using regional economic modeling and geographical information systems.  Students currently in our Ph.D. program are working on community development projects in the Adirondacks, the Lake George region, and in the Catskills.  This work has reached the stage where it could easily incorporate undergraduate research.

Key to this class is a revolutionary way to look at how economies work–structural economics.  Structural economics is an extension of input-output (IO) analysis, a powerful analytical tool that shows the flows among different sectors of an economy.  An IO table is a matrix of economic information which shows where the outputs of each economic sector goes and where the inputs to each sector come from.  An extension of this model provides a framework for examining the direct and indirect impacts of changes in what is produced and how it is produced, on income and consumption.  For example, this approach may be used to estimate the effects on each sector's resource consumption of changes in tax policy, the effects of a policy favoring certain types of new industries, or how changes in lifestyles are reflected in changing patterns of work and consumption.  Using input-output, natural resource accounts, and geographical information data, one can examine the economic, socio-economic, and environmental impacts of alternative production and consumption patterns on a particular geographic area.

 

Laptop Introductory Economics Class

            Initially, one to two sections of the Spring 2000 course in Introductory Economics will be developed as a laptop class for freshman.  Introductory economics at Rensselaer has incorporated weekly computer laboratories for the last four years, and a large enrollment laptop class is a logical extension of this evolution.  Two introductory economics classes (by Hughes and Erickson) have recently incorporated WebCt technology, which will also be enhanced in a laptop format.  Students will learn economic theory and its application through hands-on analysis, Internet access, and on-line discussion of economics in the news.  This class will pave the way for further laptop classes as more Rensselaer students participate in the laptop initiative.

 

GIS Lab Materials for IT Curriculum

The economics department has been involved in university negotiations with MapInfo, Inc., regarding GIS software and data support from its earliest stages.  One faculty member (Erickson) and two graduate teaching assistants have attending MapInfo training sessions to date.  Erickson has used MapInfo in laboratories of his Quantitative Analysis class, and both undergraduate and graduate students are incorporating GIS into research projects.  The next step is to develop self-standing MapInfo computer labs to introduce students to GIS in large enrollment classes within the economics and IT departments.  Department courses in Ecological Economics, Environmental Economics, Natural Resource Economics, Regional Economics, and Quantitative Analysis will benefit by adding spatial (GIS) and information transfer dimensions to models of resource use, externalities, and land-use planning.  An introduction to IT and global citizenry will also be added as a component to the current cross-department freshman studies course on Ecology, Ethics, and Economics (taught by Gowdy).  These GIS new labs will also benefit core IT classes such as Politics and Economics of IT, The IT Revolution, and Managing IT Resources.  Students pursuing the IT and Economics degree will also have the opportunity to develop GIS-intensive projects in their Senior IT-Economics Capstone.

 

Rensselaer School of Economics

We believe that this new type of economic analysis and teaching fits with Rensselaer's goals and its mission of using technology and information to improve decision-making and indeed to improve the lives of local citizens.  What we are currently doing in the Economics Department truly represents the cutting edge of a new economics.  Our vision is that within a few years people will refer to the "Rensselaer School of Economics". A modest investment now by Rensselaer will help to achieve that goal.

 

Budget Justification

Rensselaer expects to enroll 150 freshman in IT this Fall.  With this investment, we conservatively project the 4-year enrollments in our undergraduate program of 5, 10, 12, and 15 students per year.  The majority of the investment is in adding a server, color printer, and new software to the Economics computer laboratory, providing laptops for our teaching assistants, and creating laptop connectivity to our databases and software.  The budgeted graduate teaching assistant will aid in the coordination of the computer laboratory and act as a liaison to local communities during initial development of the IT-intensive regional economics course.  A teaching assistant from our usual budget will be used for the Spring laptop introductory economics course.  We are also requesting modest summer faculty support for course development, and a budget to develop material to advertise the IT-Economics major.