Publications

Abstract

We analyze the externality caused by the accumulation of space debris, focusing on the long-term equilibrium induced by a constant rate of satellite launches. We give conditions such that the long-term population of functioning satellites is an inverted-U shape function of the launch rate. We compare typical ways of managing the orbit. The maximum carrying capacity is the maximum population of satellites that the space sector can sustain in the long run. The physico-economic equilibrium occurs under open-access to the orbit. The optimal policy maximizes the present value profit of the space sector. Finally, we discuss the use of standard economic instruments (command-and-control, tax and market) to regulate space activity in order to achieve an optimal outcome. A numerical application based on a realistic calibration illustrates all results.

JEL Classification: L1; L9; Q2.

Keywords: Space Economics; Orbital Debris; Sustainability

Abstract

Satellites launched by independent spacefaring agencies and firms create space congestion and collision risk. Taking as benchmark the cost of a marginal reduction of the congestion rate, we discuss tax mechanisms financing a debris removal effort. We compare the non-cooperative equilibrium traffic when there is a tax on each new launch to recover cleanup costs, with the welfare optimal traffic under a centralized tax. We find that under the latter it is twice as easy to recover cleanup costs and increase traffic than under the former. We also show that a linear tax is twice as effective as a quadratic one.

Keywords: Space Debris; Satellites; Space agents; Tragedy of the Commons; Collisions; Tax systems; Game theory.

Abstract

The use of space through satellites is more and more important for nations, companies, and individuals. However, since the first satellite was sent up in 1957, mankind has been polluting space with debris (i.e., artificial objects with no function), especially in low orbits (between 100 and 2000 km). The current situation is such that: 1/ space agencies send on average several collision risk alerts every day, and 2/ satellites as well as the International Space Station regularly perform avoidance maneuvers to escape being damaged or simply destroyed.
In addition, in the last few years, these problems have become more worrisome and may permanently change dimension with the advent of mega-constellations of satellites. Indeed, in order to develop telecommunications and high-speed Internet, several companies (e.g., Starlink, Kuiper, OneWeb, Hongyan, Hongyun, Leosat, Athena) are planning to send several tens of thousands of satellites into low orbits, which are already the most polluted.
The purpose of this paper is to provide an economic analysis in terms of dynamic games of the trade-off between constellation size and cost of preserving the space environment. Our goal is to contribute to provide a framework for a sustainable development of a space economy.

Keywords: Game theorySatellites constellationsSpace congestionActive debris removalDynamic games

Abstract

This paper extends the analysis initiated by Rouillon [2020. “A Physico-economic Model of Low Earth Orbit Management.” Environmental and Resource Economics 77 (4): 695–723. https://doi.org/10.1007/s10640-020-00515-z] of the externality caused by space debris. Satellite operators make choices about the design and launch of satellites, while in-orbit servicing firms supply efforts to remove space debris. Focusing on the long-term orbital state, we compare two management regimes. The open access equilibrium occurs when the orbit is a common resource. The optimal policy maximizes the net present value generated periodically by the space industry. We investigate economic instruments capable of effectively regulating space activity. We show that the combination of an ad valorem tax, a launch tax, and a market for removal effort certificates can provide the right incentives. A numerical application using a realistic calibration illustrates our results.

JEL Classification: L1; L9; Q2.

Keywords: Space Economics; Orbital Debris; Sustainability

Abstract

This paper studies the economic consequences of orbital debris for commercial outer-space activities. Spacecraft launches and other outer-space human activities produce pollution (i.e., orbital debris), which represent a hazardous negative externality increasing the risk of collision and the destruction of satellites. We regard outer space as a global common resource, where firms operating satellites maximize profits and do not internalize the social cost of orbital pollution. We develop a dynamic investment model for satellites and simulate the calibrated model to estimate how debris affects the optimal quantity of satellites and launches, and the number of satellites destroyed by collisions. We find that the optimal quantity of satellites is a negative function of the amount of debris. The paper derives a simple expression for the maximum number of satellites to prevent the Kessler syndrome. For the baseline calibration of the model, the estimated threshold for the maximum number of satellites in orbit is about 72,000. The model is simulated to study the effects of a decline in the launch cost and the increasing number of satellites per launch.

JEL Clasiffication: D62; Q53; L80.

Keywords: Outer space; Satellites; Launches; Debris, Risk of colission; Kessler syndrome.

Abstract

The militarization and weaponization of outer space are increasing continuously with the development of new and more advanced space weapon systems by a growing number of nations. This is a direct consequence of the high and growing strategic value of outer space for defense, security, and warfare. This paper reviews trends in space weapon systems and analyzes the implications of anti-satellite military weapons for human activities in outer space. A direct consequence of the completion of anti-satellite military tests is that the amount of orbital debris has increased significantly. We use a simple physical – economic model to illustrate how anti-satellite military tests, particularly those using direct-ascent weapons, dramatically increase the probability that the Kessler syndrome will occur. Whereas the long-run impact of low altitude anti-satellite tests is limited because of atmospheric drag, at high altitude direct-ascent anti-satellite tests are persistently harmful for human activities in space. The paper also provides a simulation of the long-run effects of a war in space.

JEL Classification: D62; F51; H56.

Keywords: Outer space; Anti-satellite weapons; Orbital debris; War in space.

Abstract

In a context of intense competition for access to the Earth’s orbit, we study a model of monopolistic competition in which satellites operators diversify the variety of satellite services. We put this in perspective with the accumulation of in-orbit fragment debris and the risk it poses for the sustainability of orbital activity. Monopolistic competition leads to a sub-optimal outcome, in terms of both the number of satellites in orbit and the range of services offered. We show that monopolistic competition results in excessive orbit congestion, when Earth’s orbit carrying capacity is low and/or consumers’ preference for diversity is low, and always leads to an insufficient number of satellite services being offered. However, a strong consumers’ preference for service diversity, as it increases the market power of satellites operators, can mitigate congestion of the Earth’s orbit. Finally, we identify a pair of economic instruments capable of correcting these market failures and decentralizing an optimal state.

JEL Classification: L1; L9; Q2.

Keywords: Space economics; Orbital debris; Sustainability.

Abstract

This paper presents the Dynamic Integrated Space-Economy (DISE) model, designed to study the economic implications of alternative policies to mitigate orbital debris. The DISE model combines a standard neoclassical growth model with a physical space model for orbital debris dynamics. The economic model categorizes capital assets into two types: Earth’s capital and Space’s capital (i.e., satellites). The orbital debris model describes the dynamic of three types of objects: derelict satellites, rocket bodies, and fragments. DISE is intended to calculate the cost of space debris and its impact on the global economy. The model is simulated for a horizon of 200 years, starting from 2024, under different scenarios, including a clean space environment, laissez-faire, derelict satellites de-orbiting policy, all intact objects de-orbiting policy, debris-free launch systems, a combination of de-orbiting and debris-free launch vehicles, and collision avoidance. We find that the implementation of de-orbiting and debris-free launch systems mitigation policies is not enough to ensure space environmental sustainability, as in the long run the main source of debris generation would be collisions. Without any debris mitigation intervention, the cost of orbital debris would be more than 0.5% of world GDP in the long-run.

JEL Classification: D62; E22; H23; Q53; Q58.

Keywords: Outer space; Orbital debris; Satellites; Integrated assessment model; Mitigation policies.

Abstract

Eleven teams of experts were solicited to provide a ranked list of the 50 statistically-most-concerning objects in LEO. The approaches used by the experts and resulting lists are described in McKnight et al. (2021). An aggregation rule that leads to a collective list is also proposed. This paper offers a view from social choice theory on the aggregation process. We show that different aggregation rules may yield different conclusions about the most concerning objects. We also discuss alternative aggregation rules, and provide some recommendations concerning the question that could be addressed to experts.

Keywords: Space debris; Active debris removal; LEO; Social choice