Real-Time Monitoring of Political Crisis with Alternative Data
The recent, nationwide power outages in Venezuela were a stark reminder of how quickly an ongoing political crisis can disrupt a country’s critical infrastructure. These disruptions often lead to output contractions, which in turn can have large adverse effects on a country’s financial markets. In a more globalized world with international supply chain linkages, a crisis induced drop in one market can be contagious and quickly spread to other markets.
As such, it is important for financial managers to have timely data on the extent and magnitude of a political crisis as well as the recovery. Alternative data can fill this gap and provide financial managers and other decision makers with real-time information about disruptions to critical infrastructure.
Providing Trusted Information in a Time of Crisis — The Case of Venezuela’s Power Outages
Since early February, Monash University’s IP-Observaotry which is powered by KASPR Datahaus’ technology, has monitored the Venezuelan Internet space in real time. Data from over 9 million observations provides Venezuelans on the ground and the international community a trusted source of information about the state of the country’s Internet.
Figure 1 shows the extent of the power outages at a national level with a low of 5.6% connectivity observed immediately after the first major outage on March 7. Our figure reveals that it took the country almost a week to reach the 90% pre-crisis average connectivity level, with the recovery hampered by a number of further outages and set-backs.
Figure 1. Venezuela’s Internet Connectivity from February 6 until March 18th 2019
Regional and Sectoral Differences in Impact and Recovery
The extent of these outages of critical infrastructure often varies across space and time. Subnational regions, economic sectors and even individual firms might be hit by these shocks with different intensity and the speed of recovery can often vary largely.
KASPR Datahaus’ scanning technology allows an analysis at the subnational level to reveal different patterns in local recovery speed. The visualisation in Figure 2. shows the large regional differences in the speed of recovery of Venezuela’s Internet. Our technology can further reveal insights about sectoral differences of the initial impact and variation in recovery by industry.
Figure 2. Regional Variation in Internet Recovery in Venezuela
Some shocks won’t be televised
Shortly after the onset of the nationwide outages in Venezuela, the word about the events quickly spread through social media and other channels and the international press quickly broadcasted the events worldwide.
However, on a global scale multiple of these outages happen on a daily basis. Natural disasters damaging infrastructure, localised electricity grid failures, man-made ICT infrastructure shutdowns, or shut-downs due to strikes are just a few of these examples. A lot of these cases are not covered by the media at all and information about these events often reaches the general public only with a delay.
Timely information during Times of Crisis
KASPR Datahaus provides decision makers in the financial markets, business, government sector and not for profits with a valuable informational advantage during periods were time is a scarcity. KASPR Datahaus’ Internet scanning technology has global coverage and extracts information at an unprecedented scale.
KASPR Datahaus works together with its clients to setup customised monitoring platforms that can automatically alert their users of any disruptions to an target area’s ICT infrastructure. Our licensed dashboard technology enables users to easily visualise differences in the disruptions between regions and follow the development of the disruption in near real-time and download the raw data for further analysis.
This enables us to monitor the differences in the initial impact as well as the differences in the recovery speed at very fine levels of geographic disaggregation and also at the industry and firm level.
Figure 3. The IP Observatory’s Data Dashboard — Venezuela
NOTE: KASPR Datahaus is pleased to maintain a close working relationship with Monash University’s IP Observatory, with our licensed technology beginning its life in support of the observatory’s innovative near real time monitoring platform. Since then, our developed technology continues to provide support to the observatory’s activities, in line with our license.
