Forefront Communications

MIT News: Measuring the Economy with Location Data

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Mark Dowd

Mark Dowd

Carrying your smartphone around everywhere has become a way of life. In doing so, you produce a surprising amount of data about your role in the economy — where you shop, work, travel, and generally hang out.

Thasos Group, founded at MIT in 2011, has developed a platform that leverages that data, in anonymized and aggregated form, to measure economies for industry and investors.

Thasos’s platform — based on MIT Media Lab research by co-founders Wei Pan PhD ’15 and Professor Alex “Sandy” Pentland — crunches anonymized location data from hundreds of millions of mobile phones daily, extracting notable consumption, employment, and living behaviors.

“We process up to 3 to 5 terabytes of data per day and use that data to measure economic activities, such as how many people visit a store or a commercial property, how many people go to work or travel, and how many man-hours are spent in a factory,” says Pan, Thasos’ chief scientist.

This quantifiable information is valuable for investors, corporations, policymakers, economists, and others who need a deep economic understanding of various sectors in real-time. In November, for instance, Thasos released a study showing how Amazon’s acquisition of Whole Foods, and the subsequent price drop Amazon implemented, affected consumer behavior. Results from user location data indicated price drops drove up foot traffic by 17 percent in the immediate aftermath, with around 15 to 24 percent of shoppers defecting from nearby competing stores.

“Using generic movement patterns, we noted some shoppers started to explore Whole Foods who would never go there before,” Pan says.

With more than 25 hedge fund clients, Thasos is popular among investors, who use the platform to measure various metrics — such as employee hours worked and customer visitation — of companies they may invest in or sell shares. The startup also has corporate clients and hopes, in the future, to reach policymakers. It could produce, for instance, real-time measurements on how fiscal policies affect consumer spending, work hours, and other economic metrics.

The other Thasos co-founders are John Collins MBA ’12 and Greg Skibiski.

To read the full article, click here.

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