5 (2)

5 (2)

#### Overview of this book

Preface
Free Chapter
Value Engineering: The Secret Sauce for Data Science Success
A Review of Basic Economic Concepts
University of San Francisco Economic Value of Data Research Paper
The Economics of Artificial Intelligence
The Schmarzo Economic Digital Asset Valuation Theorem
Creating a Culture of Innovation Through Empowerment
Other Books You May Enjoy
Index
Appendix A: My Most Popular Economics of Data, Analytics, and Digital Transformation Infographics

# The Economic Value of Data Calculation

We will end this chapter with the mathematical formula for the Economic Value of Data calculation. If you can't put the formula into math, well, it'll be hard to lay claim to that Nobel Prize in Economics that I so badly desire!

The Economic Value of a Dataset (EvD) equals the sum of the Attributed Financial Value (FV) of a specific Use Case (Use_case_FV) that each dataset provides to that specific Use Case:

where m is the number of use cases, nj is the number of data sets per use case j, and a0 is a bias.

Using Figure 5.5 (repeated below as Figure 5.8 for simplicity), you apply this formula as such:

• The first iteration covers the Vendor Quality use case [Use_case_FV1], where [Use_case_FV1] equals \$60M. [Count Data_Set] = 3 since there are 3 data sources (data sources A, B, and C) that support the analytics for [Use_case_FV1]. Each of the 3 data sources is attributed (1 ÷ [Count Data_Set]) of the [Use_case_FV...