# **IX. Conclusions**

Our main conclusion is that economists should use DMSP night-time lights data as a proxy only for electricity use, measured in ten-year intervals. The data reject the hypothesis that growth in night-time lights is positively correlated with growth in population or urban population. The data do not reject positive correlations with GDP, non-agricultural GDP, manufacturing GDP or capital stocks. Unfortunately, the growth elasticities of _AoL_ and _R_ with respect to these economic variables are too small and/or unstable over time for practical use. Several other conclusions emerged as well. These are summarized below:

- The explanatory power of night-lights growth rates data is weak.  Most of the explanatory power of the regressions came from the use of fixed effects for countries and years.  On the one hand, some of this weakness may be due to the noisy nature of DMSP data.  On the other hand, such a result should not be surprising:  we know from daily experience that the absence of night-lights need not imply the absence of economic activity.

- There appears to be a difference in how _AoL_ and _R_ respond to growth.  This is true for GDP, nonagricultural GDP, manufacturing value-added, and electricity use.  In general, for those economic variables, the elasticity of growth in _R_ was larger than the elasticity of growth in _AoL_ .

- The explanatory power of the 10-year point-to-point growth rates are stronger than those for annual growth rates.  This result was predicted in Section V above, due to the noisiness of the DMSP-OLS data.  The corollary observation is that the elasticities from the 10-year growth rate equations are larger than those from the annual growth rate equations.

We believe further investigation is needed. As noted above, the DMSP-OLS data suffer from several deficiencies and are therefore rather noisy. A new satellite is generating superior night-time lights data. The data are generated by the Suomi National Polar-orbiting Partnership (SNPP) satellite series operated by the NASA – NOAA Joint Polar Satellite System that was launched in late 2011. The Visible Infrared Imaging Radiometer Suite (VIIRS) Day-Night Band (DNB) sensor mounted on the SNPPP can see in more detail, with a wider range of sensitivity and with more accuracy than the DMSP-OLS. The GSD of the VIIRS is 742<sup>2</sup> meters, producing a footprint area 45 times smaller than the DMSP-OLS footprint of 5<sup>2</sup> kilometers. It has substantially lower detection limits than the DMSP-OLS. The OLS detection limit is near 5×10<sup>-10</sup> Watts/cm<sup>2</sup> /sr while the VIIRS- _DN_ B detection limit is an order of magnitude smaller at 2×10<sup>-</sup> 11 Watts/cm2/sr.34 The VIIRS-DNB sensors also cover a wider range of radiance, covering seven degrees of magnitude extending into daylight. The VIIRS-DNB sensors cannot be saturated, which eliminates the top-coding problem that affects the largest, brightest cities. Finally, the VIIRS-DNB sensors are calibrated regularly so the margin of error associated with each pixel is sharply reduced relative to the DMSP-OLS, and enables more confidence in year-to-year comparisons.

There are two interesting caveats. Elvidge (2013) notes that the DMSP overpass time is in the early part of the evening, near 19:30. By contrast, the SNPP overpass time is after midnight, near 01:30 when the lights from many store fronts and residences will have been turned off. The likely effect would be to deemphasize commercial activity and highlight illuminated streets and highways. This might create some minor challenges in directly comparing overlapping DMSP-OLS and VIIRS-DNB observations from 2012 and 2013. The other caveat is that the increased sensitivity of the VIIRS-DNB sensor is making it difficult to eliminate light from the aurora borealis and aurora australis. This could rule out the use of VIIRS-DNB data for those portions of the world in the higher northern and southern latitudes and focus research on the areas where most of the world’s poor live.

34 Radiance is measured in watts per square centimeter per steradian (watts/cm2/sr). A steradian is related to the surface area of a sphere in the same way a radian is related to the circumference of a circle.