Use of indicator variograms for an enhanced spatial analysis

Flat variograms often are interpreted as representing a lack of spatial autocorrelation. Recent research in earthquake engineering shows that nearby field noise can substantially mask a prominent spatial autocorrelation and result in what appears to be a purely random spatial process. A careful selection of threshold in assigning an indicator function can yield an indicator variogram which reveals underlying spatial autocorrelation. Although this application involves use of seismic data, the results are relevant to geostatistical applications in general.