Space policy is driven by values that lie beyond economics --- the hunger for knowledge of the universe, the thrill of exploration. But economic analysis has a lot to say about the ways a government uses its resources to pursue those passions, and how it organizes the programs that embody them.
When President Bush proposed sending human explorers to the Moon and on to Mars, Molly Macauley, senior fellow at Resources for the Future, pointed out that the design of robots has advanced so rapidly that they can now do nearly anything that a human can, at far lower cost. Space is a dangerous place for humans, and each of the space program's fatal accidents has resulted in years of delay in further ventures.
"There will always be those who want to fly," she wrote in the Baltimore Sun. "But as the coming decades bring ever-better alternatives to humans in space, fewer leaders and voters may be willing to underwrite the risk and expense."
Macauley directs RFF's space economics program, which has been contributing to this field for many years. She is currently working with the National Aeronautics and Space Administration and the Federal Aviation Administration's Office of Commercial Space Transportation, which has regulatory authority over commercial rockets.
"I am a space enthusiast insofar as I support public funding of space exploration activities for scientific and research gain," she said several years ago in congressional testimony. But she also holds that economic logic has to meet economic tests.
Many of the conventional justifications of spending on space --- job creation, economic stimulus, technological spinoffs ---do not hold up to careful analysis, she pointed out in an overview of the subject. (Economics of Space in Space Politics and Policy: An Evolutionary Perspective, edited by Eligar Sadeh, published by Kluwer Academic Publishers, Boston, 2002)
But most of the real public benefits are difficult to quantify.
"A gap in space economics research to date is that no studies have sought to measure the national prestige, geopolitical influence, vicarious thrill of wandering or wondering, or elevation of the quality of our understanding of the solar system and other space science --- intangible benefits that many associate with space exploration. To ignore these intangible values may be to underestimate significantly the benefits of space activities."
One solution, Macauley suggested, is greater use of contingent valuation, a technique that employs surveys of public opinion regarding value of goods or benefits for which there is no market. Environmental economists frequently use it to calculate the value to the public of, for example, a clear view of a landscape, or clean water in a local river.
Similar valuation of the various competing goals of the space program could guide officials, Macauley wrote, as they deal with "the growing tension between demands for accountability in the use of public money and the freedoms granted the space program in the interests of science, technology, and other public gains."
Even when goals are incalculable, Macauley argues, economic incentives can accelerate progress toward them. In testimony before the House Science Committee in July 2004, she supported the proposal to create prizes for innovation the space program, citing the impact of prizes on the development of automobiles and aircraft.
Earlier, in a more complex case, Macauley examined the proposal for space launch vouchers (Space Vouchers for Space Science Research, Space Policy, November 1989).
The idea was conceived as an answer to the growing backlog of space research missions that had resulted, especially, from the delays following the Challenger disaster.
Instead of assuming that all launches would be operated by NASA, this alternative would provide each research mission with a voucher that could be used to buy the cheapest and earliest launch available, whether manned or unmanned.
One effect would be to stimulate the expansion of launch capabilities in other countries, and by commercial enterprises.
Macauley concluded that, even if it operated only at a small scale, a voucher program would be likely to provide space transportation at a lower cost than the Shuttle. Congress implemented the concept in 1998.
Sometimes the issue is the potential of a proposed technology. One example is satellite solar power.
The concept is a solar platform positioned in orbit where it would be continuously exposed to intense sunlight, transmitting this energy to an antenna on Earth.
In a paper broadly surveying the prospects for the idea, Macauley and her co-authors concluded that the immaturity of the necessary engineering techniques made it difficult to estimate costs, and that public anxieties about the health effects of electromagnetic fields would have to be addressed openly. (Can Power from Space Compete?, Discussion Paper 00-16, March 2000.)
Institutional structure of space activities often raises important policy questions.
A decade ago a presidential directive merged weather satellite operations of the Defense Department and the Commerce Department.
In a recent appraisal of the merger, Macauley found that it was working fairly well although it reflected the tension between two partners with different requirements (A Herculean Task? Economics, Politics, and Realigning Government in the Case of U.S. Polar-Orbiting Weather Satellites Discussion Paper 04-21, March 2004).
Research into the value of the satellite data, she concluded, could give a more stable foundation to the program's budget.
"Like beauty, the value of space exploration is in the eye of the beholder," Macauley wrote in a paper that took the first six words of its title from a science-fiction novel by Robert Heinlein (The Moon Is a Harsh Mistress: The Economic Value of Space Exploration, July 1994).
Because different people seek different goals, the political process has written into the space program's enabling legislation and policy statements a vast confusion of purposes, she observed.
The country needs a clear and rational process for weighing the space activities against other public responsibilities, and against each other.
"Balancing costs and benefits, including 'intangible' benefits," she wrote, "is information that must inform debate."
