Abstract

The Global Positioning System (GPS) delivers an extremely precise positioning, navigation, and timing signal to users around the world. Originally launched for U.S. military use, in the years since its signal was made available to the private sector, it has enabled innovators to develop a host of applications, services, and products. These advances have led to substantial gains in productivity, efficiency, and personal enjoyment.

From people driving to some place new to multinational corporations coordinating complex logistics networks, hundreds of millions of users rely on GPS every day for navigation and positioning. Its precision timing capability supports industries as diverse as finance, electricity, and telecommunications. Even the term GPS has entered the popular vernacular to mean one’s specific location at a specific point in time.

The ability to measure time intervals and frequencies extremely precisely is what allows GPS users to pinpoint their location anytime, anywhere in the world. The launch of Sputnik in 1957 and the resulting space race led the United States to accelerate scientific efforts deemed essential for national security and spaceflight capability, including the creation of what is today the Defense Advanced Research Projects Agency.

An important breakthrough occurred when U.S. researchers discovered they could discern the location of ground-receiving stations based on Sputnik’s radio transmissions and accurately determine the satellite’s orbit. That realization catalyzed research and development programs within the U.S. national laboratories, the military, and contractors in the private sector to develop satellite systems to further American geopolitical and defense interests. Programs from the 1950s and 1960s were combined in 1973 to form what is the GPS program today.

The analysis presented in this monograph focuses on the economic benefits of GPS to the U.S. private sector. We provide estimates from two perspectives. First, we quantified the value of GPS relative to alternative technologies and systems for the period from 1984 to 2017. Second, we estimated what the potential impacts would be if a GPS outage were to occur today. Our analysis combined insights from nearly 200 experts in the use of GPS for specific applications, surveys of professional surveyors and smartphone users, economic modeling tools, and national statistics. Benefits comprise productivity gains from new and existing products and services, improvements in quality, increases in personal enjoyment, and environmental and public health impacts.