Article

Broadband and Local Growth

Authors:
To read the full-text of this research, you can request a copy directly from the author.

Abstract

I find a positive relationship between broadband expansion and local economic growth. This relationship is stronger in industries that rely more on information technology and in areas with lower population densities. Instrumenting for broadband expansion with slope of terrain leans in the direction of a causal relationship, though not definitively. The economic benefits of broadband expansion for local residents appear to be limited. Broadband expansion is associated with population growth as well as employment growth, and both the average wage and the employment rate – the share of working-age adults that is employed – are unaffected by broadband expansion. Furthermore, expanding broadband availability does not change the prevalence of telecommuting or other home-based work. Like other place-based policies, expanding broadband availability could raise property values and the local tax base, but without more direct benefits for residents in the form of higher wages or improved access to jobs.The analysis relies on the uneven diffusion of broadband throughout the United States, allowing comparisons between areas with greater and less growth in broadband availability. I combine broadband data from the Federal Communications Commission, employment data from the National Establishment Time-Series database, and other economic data from the U.S. Census and BLS to examine broadband availability and economic activity in the U.S. between 1999 and 2006.

No full-text available

Request Full-text Paper PDF

To read the full-text of this research,
you can request a copy directly from the author.

... However, the positive effect was observed only for a reduced number of counties (6%) characterized by intensive usage of IT and high skills, income, and population density. Similarly, Kolko (2012) assessed the impact of broadband availability on county employment from an IV estimator that used the average slope of the terrain as an instrument of the broadband indicator. The results are suggestive of a positive causal effect of broadband on employment, although the author acknowledged that IV estimates might be upwardly biased. ...
... As mentioned in the previous section, some studies using country-level data address endogeneity by estimating the effect of interest from structural multi-equation models (Gruber et al., 2014;Katz & Callorda, 2013;Koutroumpis, 2009). Others applied the single-equation IV estimator using lagged values of the broadband indicator as instruments (Celbis & de Crombrugghe, 2018;Haftu, 2018;Mack & Rey, 2014), or other variables that are expected to determine broadband but not the outcome variable in a direct way (Castaldo et al., 2018;Czernich, 2014;Czernich et al., 2011;Forman et al., 2012;Ivus & Boland, 2015;Kolko, 2012;Mack & Rey, 2014;Rohman & Bohlin, 2012). ...
... 10 Other studies (e.g. Ivus & Boland, 2015;Kolko, 2012) use geographical characteristics of the spatial units as instruments of the broadband indicator. The argument is that the cost of broadband deployment varies depending on the characteristics of the local terrain. ...
Article
This paper analyses the incidence of broadband on regional productivity in Brazil, intending to find out if the economic impact is uniform across all territories of the country. The possibility of performing a regional approach to test the effect of broadband on productivity in an emerging country represents a novelty for the literature. Results suggest that the impact of broadband on productivity is positive although not uniform across regions. On the one hand, it seems to depend on connection quality and network effects. Faster download speed and critical-mass accounting for network externalities in the region enhance the economic impact of broadband. On the other hand, higher productivity gains are estimated for the less developed regions. The fact that the less productive regions in Brazil seem to be benefiting more from broadband may suggest that it can constitute a factor favoring regional convergence in the country.
... Although various studies suggest positive macroeconomic economic effects (Koutroumpis, 2009;Czernich et al. 2011;Nadiri, Nandi and Akoz, 2018), there is a growing school of thought which argues that the economic impact of high-speed broadband is over-stated and could lead to broadband subsidies wasting billions of dollars of tax payer's money (Kenny and Kenny, 2011;Ford, 2018). While basic broadband infrastructure access is known to be a necessary ingredient to enable local economic development (Kolko, 2012;Jayakar and Park, 2013), there is debate around the level of influence high-speed broadband has on various economic metrics such as economic growth, employment and business creation. ...
... Another major area of study is the potential for broadband to generate additional employment. Kolko (2012) finds that US employment was positively affected by broadband availability between 1999 and 2006. The effects are particularly strong in industries which rely more on information technology, and in areas which are less densely populated. ...
... A later study by Jayakar and Park (2013) reports similar findings, with a 10% increase in broadband availability reducing the unemployment rate by 0.7%. However, when Kolko (2012) examines metrics such as unemployment and the average wage, there appears to be little if any effect which can be attributed to broadband. This raises the important question of whether broadband truly brings benefits to local residents, with the result implying that the actual advantages for local economic development being rather limited. ...
Preprint
Basic broadband connectivity is regarded as generally having a positive macroeconomic effect. However, over the past decade there has been an emerging school of thought suggesting the impacts of upgrading to higher speed broadband have been overstated, potentially leading to the inefficient allocation of taxpayer-funded subsidies. In this analysis we model the impacts of Next Generation Access on new business creation using high-resolution panel data. After controlling for a range of factors, the results provide evidence of a small but significant negative impact of high-speed broadband on new business creation over the study period which we suggest could be due to two factors. Firstly, moving from basic to high-speed broadband provides few benefits to enable new businesses being formed. Secondly, strong price competition and market consolidation from online service providers (e.g. Amazon etc.) may be deterring new business start-ups. This analysis provides another piece of evidence to suggest that the economic impact of broadband is more nuanced than the debate has traditionally suggested. Our conjecture is that future policy decisions need to be more realistic about the potential economic impacts of broadband, including those effects that could be negative on the stock of local businesses and therefore the local tax base.
... We specifically tested whether HBBs in rural areas make greater use of digital technologies than those in towns or cities and whether there are differences in the engagement of small businesses located in cities, towns or rural areas by whether they are HBBs or non-HBBs -but could not find any statistically significant differences. While some studies have emphasised digital technologies specifically for running a business from home in rural and remote areas (Philip and Williams, 2019;Townsend et al., 2017;Newbery and Bosworth, 2010;Wynarczyk, 2005), other studies have found no impact of broadband expansion and the prevalence of home-based business and other forms of home-based work (Kolko, 2012). Similarly, it was suggested that investment in broadband expansion in remote/rural areas would benefit the entrepreneurial activities in areas where small businesses were already well-networked but it can equally lead to a decrease in entrepreneurial activities in remote areas due to increased competition in international markets (Cumming and Johan, 2010). ...
... This links to our first point about the diversity of the home-based business sector. Broadband investment has the highest impact on technologyreliant industries (Kolko, 2012). This is a minority of the home-based business sector and therefore the potential future impact of investments in mobile networks/broadband in rural areas is likely to have a small positive effect on the prevalence of digitally engaged homebased businesses. ...
... Moreover, government investment to support the take-up of digital technologies of SMEs need to go beyond investment into infrastructure and consider the existing small business sector in a specific area (i.e. industry composition, support networks). This is because it seems rather unlikely that home-base business start-ups increase simply as a consequence of improved broadband and internet connection (Kolko, 2012). But equally, our evidence that only a minority of small businesses engage in e-commerce could be seen as a justification for interventions to achieve a digital transformation of the small business sector. ...
Article
Full-text available
This paper explores the engagement of home-based businesses in digital trading, measured as proportion of their sales from buying and selling services and products online of all their sales. Findings are drawn from a sample of 994 Small- and Medium-Sized Businesses that are members of the Federation of Small Businesses in Scotland. Multivariate findings show that home-based businesses are associated with high proportions of online sales supporting the view of home-based businesses as ‘online’ businesses. However, quantitatively, the overall transformational effects of digital technologies on the nature and processes of entrepreneurship are rather small as the vast majority of home-based businesses, like SMEs that are not home-based, trade offline. Online business models represent a very small proportion of the home-based business sector. Home-based businesses in rural areas do not make greater use of e-commerce. The findings add to the critical literature on the transformative nature of digital entrepreneurship and the emerging home-based business literature that question whether the role of digital technologies and online marketplaces for home-based businesses are being exaggerated, particularly in rural economies.
... This database contains counts of providers at various geographic scales. We choose to use provider counts as the basis for the BITS based on the precedent set by prior studies which use provider counts in their analyses [21][22][23][24][25]. Furthermore, the number of providers is meaningful in a policy context because broadband policies often endeavor to add providers to a region through subsidies or regulation [22]. ...
... This database contains counts of providers at various geographic scales. We choose to use provider counts as the basis for the BITS based on the precedent set by prior studies which use provider counts in their analyses [21][22][23][24][25]. Furthermore, the number of providers is meaningful in a policy context because broadband policies often endeavor to add providers to a region through subsidies or regulation [22]. ...
... It has also increased the importance of understanding where this essential infrastructure is lacking. The Form 477 database from the Federal Communications Commission (FCC) contains spatial and temporal information about broadband provider counts, which are important and meaningful from a policy perspective because broadband policies often work to add providers to a region, whether that is through subsidies or regulation [22]. Provider counts are also used in broadband-related analyses [21][22][23][24][25]. ...
Article
Full-text available
To evaluate actions taken to implement the Telecommunications Act of 1996, the primary goal of which was to foster competition in the industry, the FCC created a standardized form (Form 477) to collect information about broadband deployment and competition in local telephone service. These data represent the best publicly available record of broadband provision in the United States. Despite the potential benefits offered by this database, there are several nuances to these data related to shifting geographies and reporting requirements that uncorrected, prevent them from being used as an uninterrupted time series for longitudinal analyses. Given the analytical challenges associated with the FCC Form 477 data, the purpose of this paper is to present a solution to the fragmented nature of these data which prevents meaningful longitudinal analyses of the digital divide. Specifically, this paper develops and describes a procedure for producing an integrated broadband time series (BITS) for the last decade (2008–2018). This includes the procedures for using these data, their value to social and economic analysis, and their underlying limitations. The core contribution of this paper is the creation of data infrastructure for investigating the evolution of the digital divide.
... There are several studies on the impact of broadband access at the regional level although a strong focus is held on employment (Kolko, 2012, Atasoy, 2013Whitacre et al., 2014;Ford, 2018, for instance) rather than on firm dynamics or performance (Audretsch et al., 2015;Canzian, Poy and Schuller, 2019;Hasbi, 2020;McCoy et al., 2018). Most likely, this relates to issues with data deficits or availability. ...
... Numerous studies on the link between broadband access and regional employment growth are based on data for North America. Some find clear significant correlations between local broadband coverage, defined by speed, and employment growth (Atasoy, 2013;Kolko, 2012), while others report no positive impact on jobs from the availability of broadband or from a speed upgrade (Ford, 2018;Whitacre et al., 2014). Deployment of broadband in Canada is found to promote rural wage growth and employment in services, but not in manufacturing industries (Ivus & Boland, 2015). ...
Article
The aim of this study is to examine the relationship between high-speed fibre broadband access and establishment dynamics at the municipality level. Special emphasis is placed on micro as well as on small and medium-sized establishments in contracting areas. Data cover information on 290 municipalities in Sweden for the period 2010–2018. Results of Fixed Effects and Spatial Durbin model estimations reveal a significant but rather small direct effect of lagged high-speed broadband access, driven by the micro establishments. However, when the proportion of establishments with high-speed broadband access is combined with the local presence of university educated employees and researchers, a stronger indirect relationship appears. There is also some evidence that the broadband availability in neighbouring municipalities has a spillover effect. A high degree of heterogeneity is found in the results, where the relationship is far weaker in contracting municipalities and in those with a low-skilled workforce.
... A number of studies have already provided some answers by examining broadband effects on various economic indicators, including economic growth, productivity, employment or unemployment, income, population, property values and, last but not least, firm location (see, among others, Atasoy, 2013;Bai, 2017;Briglauer & al., 2019;Czernich, 2014;De Stefano & al., 2014;Deller & Whitacre, Forthcoming;Forman & al., 2012;Guidry & al., 2012;Gurney, 2012;Ivus & Boland, 2015;Kandilov & Renkow, 2010;Kolko, 2012;Lapointe, 2015;Lehr & al., 2006;Mahasuweerachai & al., 2010;Mack, 2014;Mack & Rey, 2014;Mack & Wentz, 2017;Van Gaasbeck, 2008;Whitacre & al., 2014-a;2014-b). Among the investigated economic outcomes, firm location is of particular interest for at least two reasons. ...
... Instrumental variables have also been used, with the advantage of controlling for both reverse causality and unobserved heterogeneity. The slope of terrain (or variation in elevation) is one of the most widely used instruments, with the idea that deployment costs are higher, and thus broadband access is lower, where the terrain is steeper (Kolko, 2012;Ivus & Boland, 2015). Other commonly used instruments are household density (Mack & al., 2011;Mack & Rey, 2014;Mack & Wentz, 2017;Van Gaasbeck, 2008) and pre-existing telecommunication networks, such as voice-telephony and TV networks (Czernich, 2014), with the rational that broadband deployment costs are much lower where telecommunication networks already exist. ...
Article
Full-text available
We provide a quantitative literature review on broadband and firm location. While most previous works find that broadband has positive effects on firm location, the impact is very heterogeneous across studies. We examine the role of three categories of variables (context, methodological choices and publication characteristics) in explaining the variation in previous estimates. The results indicate that broadband effects are significantly more beneficial in urban areas, whereas lesser effects are found for finance, real estate and insurance. Methodological settings, and particularly the choice of the level of analysis, of control variables and of the econometric estimator, also play a significant role in explaining the differences in previous estimates. These results are then discussed to find some answers to relevant policy and research issues.
... market outcome. In particular, Czernich et al. (2011) and Kolko (2012) estimate the effect of broadband infrastructure and find a positive link between economic growth and high-speed internet deployment. DeStefano, Kneller, and Timmis (2018) find that high-speed internet implementation has a strongly positive effect on firm's performance, such as employment and sales. ...
... A number of studies (for instance, Akerman, Gaarder, and Mogstad 2015;Atasoy 2013;Fabritz 2013;Ivus and Boland 2015) examine labor market returns to high-speed internet, including employment and wage rate. 3 It is worth noting that most of these studies, however, focus on developed countries-for example, the United States (Atasoy 2013;Kolko 2012), and European countries (Akerman, Gaarder, and Mogstad 2015;DeStefano, Kneller, and Timmis 2018;Fabritz 2013). To this end, an important gap in the literature is how these programs affect firms and individuals in developing countries; developing countries are typically suffering from poorly designed institutions and markets, and government agencies in many developing countries are implementing high-speed internet policies, with the aim of improving productivity and job creation (Bangladesh, 2008;Malaysia, 2010;Brazil, 2010;India, 2014;Benin, 2017;Philippines, 2018). ...
Article
This paper examines the effect of high‐speed internet on firm's productivity and worker's wage in China. We exploit a national policy reform and devise a difference‐in‐difference strategy to address the endogeneity. We find that high‐speed internet significantly increases firm's productivity and worker's wage, and the estimate is larger for firms in industries with high skill intensity and for more educated workers. We provide suggestive evidence that the mechanism is likely from firm's increased use of skill‐biased technology and the flattened management organization. (JEL O2, O3, J3)
... As we see in the research Kolko J. [10] the specialists in IT sector depend on the development of the Internet most of all. At the same time, managerial services for big companies, research, technological and informational services also positively depend on the development of the Internet in rural areas. ...
... At the same time, managerial services for big companies, research, technological and informational services also positively depend on the development of the Internet in rural areas. But Kolko J. did not find the dependance of the educational, health, social services, art and entertainment on the Internet development [10]. ...
Article
Full-text available
The objective of the article is to analyze the number of employees aggregated in the mass media and content sector in Russia for the period from 2010 to 2019. Mass media and content sector is one of the sectors which is developed very dynamically at the present time. Since rural people do not possess high-skill professional skills and competencies at the present time, the IT sector is excluded from the analysis. With the help of prior research of competencies and skills of rural people we also made the forecast of the most appropriate sector to produce services on- line. Then thanks to prior research about goods and services on demand in Russian e-commerce, we elaborated the list of services which rural people can produce and sell remotely with the help of Internet. This primary list recap services which almost anu individual can produce. But to be capitalized they need to be branded and advertised appropriately.
... Studies continue to assess the role broadband plays in local (Whitacre et al. 2014a), regional (Grubesic and Mack 2016), and national economic growth and productivity (Atif et al. 2012;Czernich et al. 2011). Although some studies found that broadband was not an important contributor (Jayakar and Park 2013), a majority of research has documented a positive correlation or even a potentially causal relationship between broadband access/adoption and improvements in income and employment (Kolko 2012;Holt and Jamison 2009;Whitacre et al. 2014a). Other studies have shown that broadband matters for other areas of life as well, including civic engagement, housing values, and migration (Mossberger et al. 2012;Mahasuweerachai et al. 2010;Deller and Whitacre 2019). ...
... At the county-level, one study assessed the relationship between two broadband availability indicators and earnings, and found that in general broadband does impact productivity-but only in places with levels of human capital and/or highly skilled occupations (Mack and Faggian 2013). Another county-level study looked at the impact of broadband availability on the average pay per employee (Kolko 2012). However, this study uses a different productivity measure than earnings, economic growth, or employment and incorporates more broadband variables beyond simple availability. ...
Article
Full-text available
The impact of broadband access and use continues to transform the socioeconomic landscape placing this twenty-first century infrastructure at the center of current policymaking discourse. Past studies have found a relationship between infrastructure investments and economic productivity. Recent broadband-related studies, however, have focused on general availability or adoption, and do not distinguish which specific aspect of the technology is most associated with productivity. Utilizing cross-sectional county-level data from 2017 and spatial econometric models, this research looked into better understanding the impact of multiple broadband indicators on job productivity, including innovative broader measures of digital inclusion. Results indicate that broader metrics focused on adoption or digital distress had a larger positive impact on job productivity in comparison to measures focused on speed or availability. Moreover, these impacts vary across urban and rural settings. Although the relationships identified are not necessarily causal, an alternative matching technique generally supports the results. These findings suggest that the relationship between broadband and economic productivity should be viewed from a larger, more comprehensive socioeconomic perspective. Future research should focus on looking at these effects over time and assess how policies focused on specific broadband characteristics have impacted growth.
... Dennoch steht der Ausbau von Breitbanddatenanschlüssen abseits der Zentren mit dem Argument des Wirtschafts-und Beschäftigungswachstums in ländlichen Gebieten in den Industrieländern ganz oben auf der politischen Agenda (Kolko, 2012 ...
... B.Sahraoui, 2007), und die Netzverfügbarkeit somit zunehmend ein Entscheidungskriterium in der Wohnortwahl wird, ergibt sich daraus ein Steuerungsinstrument für die Gestaltung der Siedlungsstrukturen.Zu den Effekten der Netzverfügbarkeit liegt einige internationale Evidenz vor. So findetKolko (2012) für die USA einen positiven Effekt der Verfügbarkeit von Breitbanddatennetzen auf die Bevölkerungsentwicklung ländlicher Gebiete. Die Verfügbarkeit von Breitbandnetzanschlüssen kann also möglicherweise auch dazu beitragen, der "Bildungswanderung"  dem dauerhaften Abzug der jüngeren, gut ausgebildeten Bevölkerung  aus ländlichen Gebieten entgegenzuwirken. ...
Article
Full-text available
Digitalisierung verändert die Bedeutung von Raum und Distanz. Aufgrund der Verringerung der Transaktionskosten nehmen die Möglichkeiten der Leistungserbringung über größere Distanzen deutlich zu. Trotzdem bringt Digitalisierung nicht zwingend eine wirt-schaftliche Konvergenz zwischen peripheren und zentralen Räumen mit sich. Agglomerationsvorteile und eine bessere Ausstattung mit Technologie, Humankapital und Infrastruktur verstärken, wenn die menschliche Arbeit komplexer wird, die Standortvorteile von zentralen Räumen weiter. Digitale Technologien bieten dennoch Entwicklungschancen für ländliche Räume, wenn die notwendige Ausstattung mit Infrastruktur und qualifiziertem Humankapital gegeben ist. Digitalisierung verändert zudem die weltweiten Handels-ströme und fragmentiert die Wertschöpfungsketten. Besonders für kleine und mittlere Unternehmen sowie den Dienstleistungssektor erhöht der zunehmende Einsatz digitaler Technologien die Exportfähigkeit.
... Important studies such as Crandall et al. (2003), Lehr et al. (2005), and Ford and Koutsky (2006) concluded that communities with broadband experienced faster job and firm growth than non-broadband communities. Kolko (2010Kolko ( , 2012 added that the positive relationship between broadband expansion and economic growth is even stronger in industries with a greater reliance on information technology and in areas with low population densities. Atasoy (2013) concluded that gaining access to broadband services in a county is associated with approximately a 1.8 percentage point increase in the employment rate, with larger effects in rural and isolated areas. ...
... We use broadband availability rather than adoption data in this study for two reasons. While availability data has limitations as pointed out by Ford (2011) and others, Kolko (2012) points out that adoption rates can be influenced by economic growth more so than availability, thereby exacerbating the endogeneity problem. Importantly, from the perspective of our study, adequate adoption data does not exist. ...
Article
Full-text available
We examine the effects of broadband speed on county unemployment rates in the U.S. state of Tennessee. We merge the older National Broadband Map dataset and the newer FCC dataset in lengthening our broadband access data over the period 2011–2015. Extending the dataset improves the precision of the estimates. Our panel regressions control for potential selection bias and reverse causality and show that broadband speed matters: unemployment rates are about 0.26 percentage points lower in counties with high speeds compared to counties with low speeds. Ultra-high speed broadband also appears to reduce unemployment rates; however, we are unable to distinguish between the effects of high and ultra-high speed broadband. We document beneficial effects of the early adoption of high speed broadband on unemployment rates. Better quality broadband appears to have a disproportionately greater effect in rural areas.
... To solve the endogenous problem, we have to find an appropriate instrumental variable. With reference to the research of Kolko (2012), this paper uses altitude as an instrumental variable of informationization. The geographical environment of a region can affect the cost of local informationization construction. ...
Article
Full-text available
Abstract With the in-depth development of informatization, the role of new ventures and small and micro enterprises in economic growth has become increasingly prominent. However, rare literature systematically studies the impact of informatization on entrepreneurship. Based on the data from the 2011 China Household Finance Survey and the Report of China Informationization Development Assessment (2013), this paper uses the probit model, the multiple-choice probit model, and the Heckman two-stage model to examine the influence of informationization on entrepreneurial choices and entrepreneurial performance. The research finds the following conclusions. Firstly, informationization not only significantly improves the probability of entrepreneurship, but also facilitates the realization of income and employment effects from entrepreneurship. Secondly, information infrastructure, government informationization, and resident informationization, as informationization dimensions, can significantly increase the probability of entrepreneurship, although enterprise informationization plays an opposite role. Finally, the influence of informationization on promoting entrepreneurship varies with entrepreneurial type and entrepreneurial industry.
... FTTH has also broader economic effects. Atasoy (2013) and Kolko (2012), for example, find a positive relationship between the broadband expansion and employment growth in the US, based on the data collected between 1999 and 2006. Finally, ecologic benefits are associated. ...
Thesis
Full-text available
Digitization causes large amounts of data in organizations (e.g., transaction data from business processes, communication data, sensor data). Besides, a large number of data sources are emerging online and can be freely used. Firms are looking for ways to commercialize this increasing amount of data and research aims to better understand the data value creation process. The present dissertation answers five central research questions in this context and examines how machine learning (ML) can be used to create value from data, using case studies from energy retailing and energy efficiency. First, a systematic literature review gives an overview of firm internal and external data sources for potential analyses. Second, the importance of human cognition, theory, and expert knowledge in effective data preparation for ML is demonstrated. Third, current ML algorithms and variable selection methods are empirically compared using industry data sets. Implications for theory and practice are identified. Finally, the successful use of the information gained through ML is exemplified through case studies where increased energy efficiency, customer value, and service quality can demonstrate economic, environmental, and social value. Thus, this empirical work contributes to the so far rather conceptual discussion on value creation from big data in information systems research.
... This makes intuitive sense due to the superior functionality of broadband enabled computers in comparison to broadband enabled mobile devices, or computers connected via dial-up. Kolko (2012) finds causal evidence that expanding access to broadband providers, from zero providers to 1-3 providers, positively impacted employment growth and establishment growth in the US by 6% and 5%, respectively, over the seven-year period from 1999 to 2006. These impacts were higher for less densely populated areas and for industries more reliant on IT services in their business processes. ...
Article
Full-text available
Abstract: Access to high-speed Internet is essential for full and consequential participation in the civic, economic, and education systems of modern life. According to the Annual Broadband Adoption Survey, approximately 30% of Californians continue to lack “meaningful internet access” at home, creating a Digital Divide that is worse among already disadvantaged communities. As recent efforts have made access to the necessary broadband infrastructure near ubiquitous, this indicates alternative barriers to expanding the adoption of broadband technology. We explore the economic benefits of broadband adoption and historical precedence of government investment in utility infrastructure and adoption, arguing that government support for broadband must move beyond infrastructure deployment to further household adoption. We develop a framework for thinking about broadband adoption, applying it to the case of California to generate policy recommendations.
... Notwithstanding, the scientific literature puts too much stress on face-to-face communication issues (Mack, 2014) while discussing the effect of broadband provision in regional development. Even though some papers point at positive externalities as the result of ICT development in remote regions (Kolko, 2012;Atasoy, 2013), digital technologies may also increase competition in local markets, causing thus a decline in business activity (Cumming & Johan, 2010). That idea supports a contradicting view that an effect of ICT in rural areas is very limited (Kandilov & Renkow, 2010;Whitacre, Gallardo, & Strover, 2014). ...
Preprint
Full-text available
Information and communication technologies (ICT) have penetrated almost all everyday activities globally, stimulating economic development and transforming existing business patterns. Still, despite a bulk of research work addressed to the effects of ICT on economics and business, we cannot understand their role in a modern society to a full extent. In our paper, we used a bibliometric analysis (text mining) in order to identify the core of the research in up-to-date scientific literature at the junction of ICT and economics (business), but also those research fields that still remain poorly investigated. Results demonstrate that particular research fields, eg. role of ICT on business location patterns, entrepreneurship and innovative activity of firms, require much more attention.
... In terms of economic outcomes, there are growing indications that broadband connectivity does contribute to local economic growth, typically measured as job growth (and reduced unemployment) as well as increases in local income. For example, focusing just on a few studies examining the United States, Kolko (2012), Gillett et al., (2006), Jayakar and Park (2013), Whiacre, Gallardo and Strover (2014), and Whitacre, Strover and Gallardo (2015) have all found that increased availability of broadband does appear to lead to enhanced economic outcomes. ...
Article
A great deal of scholarship on broadband deployment and federal policies has positioned rural America through a deficit framework: rural parts of the country have older populations (and therefore not tech savvy), are poor (and therefore justifiably ignored by the market), too remote (therefore outside of legitimate profit-making enterprise), and losing population (and therefore significance). This research examines rural Internet connectivity through the lens of local libraries lending hotspots for Internet connectivity. Qualitative data gathered in 24 rural communities in Kansas and Maine undercut simplistic notions regarding how communication systems operate in environments ignored by normative market operations. Financial precarity and pressures from social and economic institutions compel rurally based individuals and families to assemble piecemeal Internet presence and connectivity. The public library plays a crucial role in providing Internet resources and stands out in the rural environment as a site that straddles public trust and local.
... They further opine that with a large number of subscribers, mostly concentrated in urban areas, there is a huge economic opportunity in rural India. One may find several similar observations on the immense power of broadband penetration in the way citizens socialize, work and educate themselves, keep themselves gainfully and healthily engaged (Bojnec & Ferto, 2012;Kolko, 2012;Jayakar & Park, 2013;Jiménez et al., 2014). Upgradation of human capital in knowledge based economy through broadband diffusion is also highlighted (Johnson, Manyika & Yee 2005). ...
... ICTs have played a role as a driver of productivity [Brynjolfsson and Hitt 1996] and local economic growth [Kolko 2012], potentially leading to an increase in household income. Internet access has also provided various benefits to individuals and communities, such as more opportunities for education and employment [Atasoy 2013]. ...
Article
Under what conditions is the Internet more likely to be used maliciously for criminal activity? This study examines the conditions under which the Internet is associated with cybercriminal offenses. Using comprehensive state-level data in the United States during 2004–2010, our findings show that there is no clear empirical evidence that the Internet penetration rate is related to the number of Internet crime perpetrators; however, cybercriminal activities are contingent upon socioeconomic factors and connection speed. Specifically, a higher income, more education, a lower poverty rate, and a higher inequality are likely to make the Internet penetration be more positively related with cybercrime perpetrators, which are indeed different from the conditions of terrestrial crime in the real world. In addition, as opposed to narrowband, the broadband connections are significantly and positively associated with the number of Internet crime perpetrators, and it amplifies the aforementioned moderating effects of socioeconomic status on Internet crime offenses. Taken together, cybercrime requires more than just a skilled perpetrator, and it requires an infrastructure to facilitate profiteering from the act.
... 34 ) Generell vorhandene Standortvorteile von Anbietern im Zentrum (Glaeser, 2011) -wie etwa eine bessere Ausstattung mit Humankapital, eine bessere Anbindung an globale wie nationale Märkte aus Infrastrukturvorteilen, die bessere Verfügbarkeit spezialisierten Wissens aus Informationsvorteilen bzw. Agglomerationseffekten  gegenüber Anbietern in der Peripherie können sich damit stärker auch überregional durchsetzen(Shearmur -Doloreux, 2008).Dennoch steht der Ausbau von Breitbandinternet abseits der Zentren mit dem Argument vonWirtschafts-und Beschäftigungswachstum in ländlichen Gebieten ganz oben auf der politischen Agenda in hochentwickelten Ländern(Kolko, 2012). Die Literatur findet zu den Effekten von Breitband auf die Entwicklung von ländlichen Räumen unterschiedliche Ergebnisse. ...
Research
Full-text available
Digitale Technologien stellen bestehende Marktmechanismen, wirtschaftspolitische Instrumente, Strukturen sowie ökonomische und soziale Interaktionen grundlegend in Frage. Während auf traditionellen Märkten den Preisen von Gütern und Dienstleistungen die zentrale Allokationsfunktion zukommt, wird der Konnex zwischen Preis und Wert in der datengetriebenen Ökonomie weitgehend aufgelöst. Die Ursache dafür liegt in der spezifischen Kostenstruktur, die durch hohe Fixkosten bei gleichzeitig äußert niedrigen Grenzkosten (nahe Null) gekennzeichnet ist. Diese Kostenstruktur begünstigt die monetär (fast) kostenlose Skalierung digitaler Produkte und Dienstleistungen auf Plattformmärkten". In der digitalen Ökonomie bildet die Verfügungsmacht über Daten den entscheidenden Wettbewerbsfaktor. Im Extremfall entstehen daraus (natürliche) Monopole. Auf der Grundlage von sechs Themenfeldanalysen (Makroökonomie, Öffentlicher Sektor, Wettbewerb, Raum, Soziale Sicherheit, Umwelt und Energie) werden die Erkenntnisse zu drei Metahypothesen verdichtet, die den Handlungsspielraum zur optimalen Nutzung der Vorteile der Digitalisierung für Wirtschaftswachstum, Beschäftigung und Wohlstand abstecken: 1. Die "neue" Ökonomie ist eine Ökonomie digitaler Daten ("Digitalismus"). 2. Vorhandene Strukturen brechen auf ("Strukturbruch"). 3. Neue Strukturen manifestieren sich in Extremen ("Polarisierung").
... Results using US data are increasing in number and scope, and generally support the idea that there are significant spillovers associated with broadband access and use. Positive relationships have been found between broadband availability and employment rates (Atasoy, 2013;Jayakar & Park, 2013), population and employment growth (Kolko, 2012), number of businesses (Gillet, Lehr, Osorio, & Sirbu, 2006), locations of specific categories of firms (Mack & Grubesic, 2009;Mack & Rey, 2014;Tranos & Mack, 2016), and sector-specific output (Crandall, Lehr, & Litan, 2007;Shideler, Badaysan, & Taylor, 2007). Holt and Jamison's (2009) review of the US literature suggests that there typically has been local economic growth after increases in broadband infrastructure, but that endogeneity issues make claims of causality difficult. ...
... Bagues & Sylos Labini (2007) find that the implementation of a job board by Italian universities reduced unemployment by 1.6 percentage points and increased wages by 3 percentage points for users. Kolko (2012) find positive impacts of broadband roll-out on population and employment growth at the zip-code level in the United States, with no impacts on the employment rate. None of these papers, however, analyzes the impacts by gender. ...
Article
Full-text available
This article investigates the link between digital technologies and female labor market outcomes in a country with one of the largest gender disparities. It exploits the massive roll-out of mobile broadband technology in Jordan between 2010 and 2016 to identify the effect of internet adoption on labor force participation. Using panel data at the individual level with rich information on labor market outcomes, internet use and gender-biased social norms, the article finds that internet adoption increases female labor force participation but has no effect on male labor force participation. The increase in online job search explains some—but not all—of the total increase in female labor force participation. Only older and skilled women experience an increase in employment in response to having internet access. The internet also reduces the prevalence of gender-biased social norms, early marriage and fertility.
... Forman et al. (2012) find that firms' investment in advanced internet technology increases employment growth in US counties, but only in a small subset of already technologically advanced counties. Kolko (2012) finds for US counties and ZIP code areas that the number of broadband providers increases employment growth, mostly in technology-intensive sectors (e.g., scientific and technical services). Whitacre et al. (2014) find that rural US counties with higher levels of broadband adoption experience higher employment growth. ...
Article
Full-text available
This study investigates the effect of broadband internet availability on German establishments’ employment growth. The database used is a random sample of business establishments, augmented by the local availability of broadband. The observation period is 2005–2010, when broadband was introduced in rural regions of Western Germany and in large parts of Eastern Germany. For the Western German subsample, technical frictions in broadband rollout are exploited to obtain exogenous variation in broadband availability. The findings indicate a negative (albeit not very robust) employment growth effect of broadband availability for Western German manufacturers, and a robustly positive effect for Western German service establishments, including most knowledge-intensive industries. For Eastern Germany, a similar identification strategy is potentially available, but turns out invalid in this particular setting. An alternative identification approach (a long difference model) indicates positive employment growth effects in both sectors for Eastern Germany. Overall, the findings suggest that broadband expansion has helped create jobs in firms which use broadband intensely.
... Czernich ym. 2011;Kolko 2012;Whitacre ym. 2014). ...
Book
Full-text available
Tässä Suomen Kuntaliiton koordinoiman Maaseudun INFRA -verkoston tilaamassa selvityksessä käsitellään maaseudun valokuituverkkojen tilannetta sekä valokuituinvestointien toteutusmalleja ja rahoitusta. Lisäksi selvityksessä arvioidaan valokuituinvestointien paikallisia ja alueellisia sosioekonomisia vaikutuksia. Selvityksen tavoitteena on kuvata onnistuneita ja siten laajemmin hyödynnettäviksi ja edelleen kehitettäviksi soveltuvia malleja valokuiturakentamisen edistämiseksi Suomessa ja erityisesti maaseudulla.
... Economic and human geography research has explored the spatiality of different internet technologies demonstrating a digital turn in human geography (Ash, Kitchin, and Leszczynski 2016). For instance, early internet geography research explored the economic geography of the internet's infrastructure (e.g., Wheeler and O'Kelly 1999;Moss and Townsend 2000;Tranos 2013) and the economic effects that such infrastructure can generate (Kolko 2012;Tranos 2012), while more recent research focused on the characteristics and the divides among internet users (Blank, Graham, and Calvino 2018;Singleton et al. 2017) as well as the internet broadband speeds they experience (Riddlesden and Singleton 2014;Oughton, Tyler, and Alderson 2015). The underpinning of this strand of research was that the internet is a general-purpose technology and, therefore, can generate productivity-related effects (Malecki 2002). ...
Article
Full-text available
This article surveys the literature to explore whether and how internet technologies and applications such as social network sites (SNS) support social interactions and, through them, knowledge transfers at different spatial scales and settings. By employing concepts from economic geography and combining them with ideas and empirics from urban sociology, business, and media studies, this article informs urban thinking about the underpinning mechanisms behind SNS-mediated vis-à-vis face-to-face knowledge-related interactions and how they mirror but also challenge established spatial patterns of knowledge spillovers.
... The literature on the impact of broadband investments on economic outcomes is extensive. 4 The analyses range from the impact on GDP growth at national or local levels (Czernich et al., 2011;Kolko, 2012), to labor market outcomes (Forman et al., 2012;Akerman et al., 2015), to educational attainments and political outcomes (Belo et al., 2013;Campante et al., 2017;Gavazza et al., 2018), among others. Almost all these studies focus on standard ADSLbased technologies, whereas only a few of them evaluate the economic effects of investments in UFB infrastructures. ...
... In the 21st century, when the information industry is booming, broadband, as the carrier of information, plays a fundamental role that cannot be ignored in economic development [71]. In the ten years from 2008 to 2018, the number of countries that formulated broadband policies increased from 53 to159. 1 The United States, France, South Korea, Italy, and other developed countries have successively introduced new broadband development strategies to seize new opportunities for digital economic development [72][73][74]. ...
Article
Informatization and digitization have become breakthrough topics in China's economic development and environmental governance. In the same vein, knowledge, technology spillovers, and economic agglomeration effects of telecommunications infrastructure may enhance eco-efficiency. This study adopts the heterogeneous timing difference-in-difference (DID) model and event study method to evaluate the impact of telecommunications infrastructure on eco-efficiency using city-level data from 2008 to 2018 and the quasi-natural experiment of the Broadband China policy. The results indicate that telecommunications infrastructure exerts a significant positive impact on eco-efficiency, which is still validated after time trend assessment, PSM-DID estimation, instrumental variable test, and placebo test. In addition, regarding its impact mechanism, telecommunications infrastructure can promote eco-efficiency growth through green innovation, industrial structure upgrading, and resource allocation efficiency. Moreover, the heterogeneity analysis results suggest that the positive effects of telecommunications infrastructure on eco-efficiency are more noticeable in developed and higher eco-efficiency cities and cities with better transportation infrastructure conditions or higher marketization levels. The study findings incorporate telecommunications infrastructure and eco-efficiency into a unified research framework, providing a new perspective to improve eco-efficiency.
... Taking into account that our data were retrieved for 2018 only, and we are searching for a relationship between firm entry rate and ultra-broadband internet, we use the classic OLS estimated regression method in our analysis, as was done in studies by Kolko (2012) and Fabritz (2013). The equation we developed is as follows: ...
Article
Full-text available
For full text please refer to the publisher's website. Recent improvements in broadband infrastructure in Europe have introduced augmented possibilities for both businesses and individuals. As expected, the provision of high-speed internet connections for European users will be an important step towards Industry 4.0 as well as a better entrepreneurial milieu. Still, though scientific literature is replete with examples of how modern communication technologies boost productivity and economic performance, not much research indicates how broadband technologies may bolster entrepreneurship, especially at a very detailed, municipal level. The aim of this study was to find out whether high-speed broadband provision had any effect on higher firm entry rates in Brandenburg, Germany. This region was chosen because of its favorable position in the vicinity of the capital state, Berlin. We carried out an ordinary less square estimated regression analysis using a dataset built for 417 municipalities. The results show that ultra-broadband provision had no significant impact on well-performing municipalities and those located close to Berlin, with no impact in the general model, and also had a negative correlation in underperforming and peripheral areas (significant at a 5% level). This leads to the conclusion that advanced broadband infrastructure does not automatically translate into higher firm entry rates; there is no such urgency in the need for speed, as it might appear at first glance.
... One study that attempted to uncover the causal effect of broadband expansion on economic growth found some evidence of a positive effect, with the strongest employment impacts on technologyreliant industries. 17 • Consumers can choose from a wider array of goods and services when broadband access is available. The ability to shop online helps consumers save money. ...
... , evaluating the impact of a European state aid programme for speed upgrades in broadband internet availability to rural areas in the German state of Bavaria throughout 2010 and 2011, find that those municipalities with greater broadband coverage at relatively higher speed did not, on average, experience an increase in local jobs per resident. A number of early US studies found that greater broadband availability positively impacts upon employment growth across zip-code areas (Lehr et al., 2006;Kolko, 2012). However, recent US studies focusing on the employment impact of increased broadband speeds provide conflicting results. ...
... A number of early US studies found that greater broadband availability positively impacts upon employment growth across zip-code areas (Lehr et al., 2006;Kolko, 2012). However, recent US studies focusing on the employment impact of increased broadband speeds provide conflicting results. ...
Chapter
Full-text available
This chapter provides an overview of the growing body of evidence that now documents the positive impact of infrastructure for digital connectivity, as policymakers seek to harness its potential to drive economic development and improve standards of living. However, significant challenges continue to impede the delivery of comprehensive digital connectivity across all social groups and geographical contexts. As ever greater technological advances continue to shape our everyday lives, policymakers must ensure that the existing social and economic digital divide is not exacerbated. This chapter defines infrastructure for digital connectivity, as well as key concepts and terms. This is followed by a review of the economic impact of infrastructure for digital connectivity, most notably broadband, and a discussion of free and municipal Wi-Fi and rural digital hubs. The chapter concludes with an overview of how digital connectivity is measured in international frameworks and composite indices for measuring digital society and the digital economy.
... Some have employed instrumental variables, with the slope of terrain or pre-existing telecommunication networks used as instruments (Kolko, 2012;Mack et al., 2011). However, finding convincing instruments remains challenging. ...
Article
We examine the effects of broadband on establishment births for five types of areas, six industries and two speed levels. Econometric results indicate that broadband has an overall positive effect in larger, medium and small urban centers and in periurban areas but has little or no impact in rural areas. However, industry‐level analyses show that broadband can foster establishment births in rural areas in some industries, including selected knowledge‐intensive industries. Finally, there are no great differences between the impacts of basic and fast broadband, except in larger urban centers with a higher skilled workforce able to use sophisticated applications.
... More specifically, the internet, and mobile telephone, which are the driving factors of ICT, have significantly minimized communication costs by allowing individuals and companies to send and receive information fast and cheap. Those ICT indicators are also likely to increase total output and productivity (Kolko, 2012). As its main novelty, this study constructs models to detect the long-run and causal effect of mobile telephone and broadband on economic growth in the G7 countries which have not been investigated in-depth using a single dataset, to our best knowledge. ...
Article
Full-text available
Information and Communications Technology (ICT) has played overwhelming roles in the economic and social development of nations and continents in the last two decades. This study aims to explore the impact of mobile telephone and broadband use on economic growth in G7 countries using annual data covering the period of 2000-2017. We performed Pedroni cointegration, Kao cointegration, fully modified ordinary least squares (FMOLS), dynamic ordinary least squares (DOLS), and panel Granger causality tests to investigate the causal and long-run effects. The empirical findings reveal that (i) mobile telephone and broadband use contribute to economic growth in the long-run; (ii) changes in mobile telephone and broadband use significantly lead to a change in economic growth.
... Several studies have recently raised the issue of digitalization and its impact on various macroeconomic variables (Kolko, 2012;Woodhead and Berawi, 2020). Researchers have investigated the relationships between ICT and inflation, productivity (of all factors), international trade, and economic growth. ...
Article
Full-text available
This study examined the role of information and communication technologies (ICT) in labor productivity dynamics. The following ICT components were analyzed: the share of organizations using computers and the share of organizations using the internet. The purpose of the study was to analyze labor productivity in the Russian economy in the context of digital transformation, taking into account two dimensions: temporal and spatial. We investigated the impact of organizations’ use of ICT on labor productivity, the relationship between labor productivity and high-tech production, and spatial effects in the dynamics of labor productivity. We used a spatial autoregressive model (SAR) and a panel vector autoregressive model (PVAR) to analyze data for the period 2010–2018. The findings show that digitalization of business processes and an increase in the share of organizations using internet technologies leads to an increase in labor productivity. Certain socioeconomic indicators were also found to be significant, namely, real wages and the percentage of people with higher education in the workforce. Exogenous variables acting as external shocks did not exert significant effects. The results have important implications for managers who develop strategies to increase labor productivity and production efficiency. Such strategies should focus on internetization, business digitalization, and e-commerce.
... A first set of contributions has investigated the employment effects of the access to the broadband (the latter used as a proxy for ICT intensity). Kolko (2012) and Atasoy (2013), relying on US data, find that the access to broadband is significantly and positively associated to employment dynamics. The study by Jayakar and Park (2013), investigating the ICT-unemployment relationship in the US context, confirms the results of Kolko and Atasoy: countries with better broadband availability display lower unemployment rates as compared to the other countries. ...
Article
This paper explores the relation between the digitalization of labour processes, the level of routineness of labour tasks and changes in employment in the case of Italy in the period 2011-16. The levels of digitalization and routineness of occupations in more than 500 4-digit ISCO professional groups are measured using data from a unique Italian profession-level survey on skill, tasks and work contents-the INAPP-ISTAT Survey on Italian Occupations (ICP), an O*NET-type dataset. Two digitalization indices are used: a digital use index, measuring the use of computers and e-mail in the workplace, and a digital tasks index, capturing the presence of a set of key digital tasks, such as those related to programming or activities concerning the use of specialized hardware. The same dataset is used to compute a composite routine task intensity index. The descriptive evidence presented in the paper shows strong differences across occupations in the level of digitalization and routineness, and the presence of a negative relation between the two in most professional groups. The econometric estimates show that digital-intensive occupations tend to grow more than the rest of the workforce, particularly when digitalization is measured relying on the digital use indicator. The level of routineness, in turn, is negatively or, in some specifications, not significantly associated to employment change. However, occupations that are both digital and routine-intensive turn out to be penalized in terms of employment growth, providing further support to (and further qualifying) the the routine biased technological change (RBTC) hypothesis. In other words, our results show that the impact of digitalization on employment is mediated by the level of routineness characterizing the tasks bundled in each occupation.
... Similarly, Forman et al. [94] find that investment in internet is correlated with an exacerbation of wage inequality in the U.S., because wage growth only occurred in counties which already had high wages. Furthermore, Kolko [95] finds that in the U.S., in areas in which broadband expanded more rapidly, neither greater employment increases nor greater increases in average wages were found. In a study investigating the skill complementarity of broadband in Norway, the authors find that broadband adoption positively affects wages of skilled labor, but negatively impacts the wages of unskilled labor. ...
Article
Full-text available
In the wake of digitalization it is increasingly debated whether developing countries can achieve economic prosperity through industrialization in the same manner as developed countries did. At the same time, developing countries have high hopes for digital technologies to drive the transformation of the economy towards prosperity. Literature on structural change views technology as one driver of employment shifts between economic sectors, but underlying mechanisms are often overlooked. Similarly, evidence on digitalization highlights its impacts on employment, but the causes and effects require further investigation. As a consequence, both strands of literature benefit from an integrated perspective on structural change and digitalization, which has largely been lacking. Hence, we pose the following research question: What are potential linkages between structural change and digitalization? Based on a review of the existing literature we identify the drivers of structural change as well as the economic impacts of digitalization on these drivers. We then elaborate on linkages between both strands of literature, showing that digitalization impacts the drivers of structural change in various ways. Evidence suggests that digitalization is likely to affect relative sectoral productivity, but it is questionable whether destinations of subsequent labor movements (e.g. towards traditional services) will equally benefit from technological progress. Moreover, the skill bias of digital technologies may be a risk not only for equitable income gains, but also for inter-firm linkages. Our review further implies that digitalization fosters the servicification of manufacturing and presents opportunities for developing countries to diversify in traded goods and services. However, it is contested if digitalization facilitates better positioning of developing countries in global markets, or if it narrows the scope for their participation and upgrading opportunities in global value chains due to relatively larger benefits for developed countries. We thus highlight various differences between developed and developing countries in the ability to benefit from digitalization. Future studies can empirically test the proposed linkages to reveal technology-, country- and industry-specific interactions between processes of structural change and digitalization.
... Por otro lado, en estudios realizados para economías desarrolladas como Estados Unidos (EE. UU.), Kolko (2012) menciona que, si bien el internet de banda ancha y las tecnologías relacionadas reducen el costo de envío y la recepción de datos, lo cual debería aumentar la producción y la productividad, el efecto en el empleo es ambiguo dado que las tecnologías pueden ser complemento o sustituto de este. También, encuentra una diferencia en el impacto del internet de banda ancha que está en función a su nivel de implementación en el país, para período 1992 a 1999 anterior a la expansión de la banda ancha, encuentra un impacto positivo en la tasa de empleo, el salario promedio y el ingreso familiar promedio, el cual puede explicarse porque en este periodo los trabajadores con conocimiento del uso de internet escaseaban, por lo que los empleadores pagaron más por las mismas habilidades antes que en años posteriores, cuando el internet estaba más difundido, donde encontró que la expansión de la banda ancha está asociado con una disminución del empleo y los ingresos de los hogares. ...
Research
El presente estudio tiene como objetivo estimar los impactos que tienen el acceso y uso de los servicios de internet sobre el bienestar de los hogares en el Perú, para el periodo 2017-2019. Para ello, con datos de panel de la Encuesta Nacional de Hogares (ENAHO), se empleó el método de evaluación de impacto cuasi experimental de diferencias en diferencias, aunado con metodologías de emparejamientos, como el Propensity Score Maching a fin de contrarrestar el sesgo de selección. Los resultados indican que el acceso y uso de internet tienen un impacto positivo sobre el nivel de ingresos y gastos de los hogares, de acuerdo con los fundamentos microeconómicos. Este resultado se mantiene considerando el acceso a internet a través de otros establecimientos como cabinas públicas, centros educativos o de laborales, donde el impacto a nivel rural es mayor.
... On the other hand, in studies carried out for developed economies such as the United States (USA), Kolko (2012) mentions that, although broadband internet and related technologies reduce the cost of sending and receiving data, ( which should increase production and productivity), the effect on employment is ambiguous because technologies can be a complement or substitute for it. Also, there is a difference in the impact of broadband internet that is a function of its level of implementation in the country, for the period 1992 to 1999 prior to the expansion of broadband, it finds a positive impact on the rate of employment, the average salary and the average family income, which can be explained because in this period, workers with knowledge in the use of the internet were scarce, so that employers paid more for the same skills earlier than in later years. ...
Research
Full-text available
This study aims to estimate the impact generated by the access and use of internet services on the well-being of households in Peru for 2017-2019. For this, with panel data from the National Household Survey (ENAHO), the quasi-experimental impact evaluation method of differences in differences was used, together with matching methodologies, such as the Propensity Score Matching in order to counteract the selection bias. The results indicate that Internet access and use have a positive impact on the level of income and expenditure of households, according to microeconomic basis. This result is maintained considering internet access through other establishments such as public booths, educational or work centers, where impact at rural level is greater.
... With sensors and machine learning, ubiquitous network connectivity is a foundational building block of digital transformation in the public realm. It is well established the broadband coverage, connectivity, quality, and adoption contribute to GDP and local economic growth [20] [21], the location and development of clusters of knowledge-intensive firms [22], and rural employment [23], amongst others. In particular, research on free public Wi-Fi access suggests that it contributes to economic growth [24] [25], promoting tourism [26] [27], social inclusion [28], public safety [28] [29], and improved public services [27] [30]. ...
Conference Paper
Full-text available
Shopping streets are the lifeblood of rural towns performing a number of important economic, social, and environmental functions. Streets represent a public realm that is actively and passively consumed depending on how it is structured as a public space. These structures result from historic forces and planning processes that highly influence the norms for how such a space evolves, is moved through, and consumed by individuals or groups. In recent decades, stakeholders have sought to leverage technological advances to combine traditional elements of the public realm with cyber-physical systems to generate intelligence from data analysis in order to modify behaviour and optimise operations and services. While the overwhelming focus of existing research and policy focus is on "smart cities", there are significant potential benefits for rural communities. However, for many rural towns, the investment required for a "smart town" initiative is prohibitive. We posit that a smart street is more feasible and manageable for rural towns. This paper presents a working definition of a smart street, proposes a series of principles for smart street design, and identifies exemplar infrastructural elements to deliver widely accepted policies and behaviours.
... Research so far focused on whether and how the digitisation of market and non-market activities support the economy (KOLKO, 2012;KOUTROUMPIS, 2009). We understand digitisation as the transformation that socio-economic systems undergo because of the wide adoption of digital technologies (KATZ et al., 2014). ...
... The results support the views that good broadband connections increase economic opportunities and improve the conditions for economic activity and development, as demonstrated in previous studies (Forzati et al., 2012;Kolko, 2012;Prieger, 2013;Atasoy, 2013;Mölleryd, 2015), thus contributing positively to population development of the rural areas. Indeed, the results provide an incentive to improve the availability of broadband in the locally active communities and to continue the expansion of the broadband with public support if such a local activity occurs in the rural areas. ...
Article
This paper estimates the effect of the expansion of broadband infrastructure, which enables high-speed Internet, on population development in panel of Finnish areas in the period 2010–2018. The study differs from previous studies in that it uses accurate statistics on the availability of broadband in 1 km * 1 km population grids. Therefore, the impact of broadband availability on rural development is evaluated more accurately than previously. The results of the Difference-in-difference (DiD) regression analysis show that the availability of broadband reduces depopulation of remote and sparsely populated rural areas. In this respect, the telecommunication policy in Finland has been successful, and the findings encourage the expansion of broadband infrastructure in rural areas.
Article
In this article, we evaluate the rate of return to government efforts to promote broadband. Specifically, we estimate the impact of USDA's broadband loan and grant programs on the average payroll per worker using zip code level data from the Zip Code Business Patterns for the period from 1997 to 2007. Our results indicate that two of the smaller broadband programs (the Pilot loan program and the broadband grants program) likely had no effect on local payroll per workers. On the other hand, the largest program in terms of funding and coverage (the current broadband loan program) likely had a positive impact. Our estimate implies that a $1 per capita increase in a particular zip code's one‐time receipt of the current program broadband loan results in a $0.92 increase in payroll per worker annually. Our calculated point estimates of the benefit: cost ratios for this broadband program range from 1.98 to 2.99, depending on assumptions about the time frame over which benefits accrue. However, the confidence intervals are wide enough to include the possibility that the costs outweigh the benefits.(JEL L86, J30, O18)
Article
Full-text available
This paper presents some of the first evidence on the effect of information and communications technology (ICT) on college students’ labor market performance. Using a large, representative survey of college students in China, we examine outcomes before and after students were exposed to technology-aided instruction, compared with students who were not exposed to such instruction. The results indicate that the ICT program significantly increased students’ likelihood of obtaining a job offer in the labor market and the wage they were offered. The positive effect comes from students’ increased use of computers and the internet for job search. While most previous studies of the use of technology in education focus only on students’ academic achievement and find zero or negative effects, our study demonstrates that technology may be an effective tool for improving college students’ labor market performance, and that the potential benefits of technology might be underestimated if we focus only on test scores and ignore students’ career development.
Article
Full-text available
This paper conducts a comprehensive literature survey of the papers that examine the link between ICT and economic growth. Using a rigorous screening framework, we found 208 academic papers that were published from 1991 to the cutoff date of October 30, 2018. This survey provides a robust set of insights into the distribution, research strategies, and findings of the surveyed papers, taking into account their geographic focus and type of ICT-growth links. This study also reveals the key factors that predict the citation impact by paper. Among the directions for future research, this paper argues that the time has come for the research on the ICT-growth link to shift its main focus from evidencing its positive relationship to advancing the understanding on why and how emerging digital technologies directly or indirectly affect economic performance.
Article
This study aims to analyse the financial model of the information and communication technology (ICT) price basket to determine is effect on financial development indicators. This model measures cost as a percentage of gross national income per capita and the affordability of ICT services in Gulf Cooperation Council (GCC) countries for the period of 2008–2016. The results show that Saudi Arabia and Oman had high ICT price baskets, while the ICT price basket of Kuwait was low. This study applied panel-corrected standard errors, fixed effect, random effect and the generalized method of moments methods. The same results were confirmed in all tests, which showed a potentially negative relationship between ICT basket prices and financial development, as measured by domestic credit and market capitalization. The ICT basket price had a positive effect when financial development was measured by the stock market. The main conclusion is that decision-makers should adopt a long-term flexible strategy to improve the level of financial development indicators based on the ability of the GCC countries to afford ICT development.
Book
Full-text available
Julkaisu käsittelee EU-osarahoitteisten Manner-Suomen maaseudun kehittämisohjelmien aluetalous- ja työllisyysvaikutuksia, ja esittelee analyysityökalun näiden arviointiin. Tutkimuksessa luodaan katsaus maaseudun kehitykseen asumisen, työn ja yrittämisen näkökulmista ja arvioidaan ohjelmakauden 2007-2013 toimenpiteiden (maatalouden investointituet, yritysrahoitus ja kehittämishankerahoitus) kohdentumista alueille sekä syntyneitä aluetalous- ja työllisyysvaikutuksia. Arviointimenetelmä osoitti, että kehittämisohjelmalla on ollut kokonaistasolla myönteinen vaikutus työllisyyteen ja aluetalouteen, ja sen kohdennus on ollut pääsääntöisesti onnistunutta. Sekä yritysrahoitus että kehittämishankerahoitus näyttävät tunnistavan ja tasaavan maaseudun alueellisia kehityseroja. Yritysrahoitus on kohdentunut ensi sijassa kasvuyrityksille. Kaltaistamismenetelmillä lasketuissa tuloksissa tuettujen yritysten työpaikkakehitys, taloudellinen suoriutuminen ja aluetalousvaikutus ovat olleet myönteisempiä kuin tukea saamattomien verrokkiyritysten. Yritysrahoitus kanavoituu kokonaisuudessaan vaikuttaviin tukimuotoihin, mutta osa niistä on alihyödynnettyjä. Yritysrahoituksen julkisen tuen kerrannaisvaikutus aluetalouden työpaikkoihin on 1,51, mutta suora verovaikutus on pieni. Tulokset tukevat yritysrahoituksen säilyttämistä yhtenä maaseudun kehittämismuotona. Maatalouden rakennetuilla on lisätty taloudellista toimeliaisuutta ja työllisyyttä enemmän kuin tiloilla keskimäärin. Kehittämishankerahoituksen aluetalous- ja työllisyysvaikutukset taas ovat ensi sijassa välillisiä. Yritysrahoituksen julkisen tuen politiikkavaikutus on myönteinen. Alueellinen räätälöinti ja paikkaperusteisuus korostuvat, mikäli ohjelman kokonaisvaikuttavuutta halutaan parantaa.
Article
This study explores the ways and means behind evolving ICT infrastructure’s direct or indirect effect on economic growth within a conceptual framework. Advances in digital technologies, their role, and significance in techno managerial ICT solutions are examined to provide a knowledge base for assessing capabilities, possibilities, and utilities to researchers, economists, policy and decision makers for optimal resources utilization, and stimulating economic growth. Besides contributing to the fields of information systems research and growth literature, few indicators are listed for consideration in economic analysis. This broadens vision for optimizing systems infrastructure, innovation activities, and helps establish their effects on growth. The study proposes that supporting policies in combination with adequate funds provision, stable government, macro-economic determinants, and innovation environment are crucial for ICT-induced prosperity. Additionally, countries need to promote e-commerce and e-governance activities with adequate R&D support, technical support, deployment of probots knowbots and chatbots powered by artificial intelligence, autonomic computing applications, transfer of technology to industry and society, enforcement toward acceptance of digitization, and use-based rewards. The study is useful in decision-making for managers, ICT-professionals, and entrepreneurs to assess ICT solutions with economic benefits; facilitates ICT infrastructure requirement analysis, planning, and deployments with their socio-economic implications.
Article
Full-text available
Sufficient access to and utilization of broadband is an ongoing concern for rural economic development. Using a rural region in Northern New York (USA), we consider the investment and operational costs of a broadband cooperative and determine service prices for which it is financially viable. Service prices need to increase 75%–131%, depending on grant restrictions, relative to existing market prices for a new broadband cooperative to become financially feasible. Put differently, the cooperative would not cash flow at market prices unless there was at least 14 potential subscribers per mile at a 62% take rate. For a cooperative, the grant restriction that providers offer a minimum level of speed at a maximum price results in a high level of subsidization by high-speed to low-speed members to support the business. Given grant funding and member equity investments, financial infeasibility has little to do with construction costs, than with annual operational and maintenance costs required to sustain the system long term. More reasonable feasibility scenarios occur for existing utility cooperatives expanding services into broadband, particularly areas with a high proportion of high-speed, year-round users and strong take rates. Consideration of public benefits of broadband arguably needs to be added to the equation, particularly surrounding access to healthcare and educational purposes, and as a prerequisite to supporting taxpayer-funded public-private partnerships to expand broadband services. Policy levers to eliminate or subsidize property taxes and pole rental costs reduce cash flow prices considerably; however, feasibility is highly sensitive to assumed take rates.
Article
Full-text available
Over the past decade, the vision of smart cities filled with technological innovation and digitally engaged citizens has been pursued around the globe, but not all city residents have a chance to participate in or benefit from these innovations. Connectivity is unequally distributed across cities and neighborhoods, and these disparities have costs not only for individuals, but for communities, as COVID-19 so aptly demonstrated. There is a need to examine uses and outcomes for broadband across cities and neighborhoods as digital human capital in communities. Two studies summarized here show that like other human capital, technology use conveys economic benefits for communities. Broadband adoption over time is related to prosperity and growth in the 50 largest metros. Big data on the density of domain name websites shows that this measure of technology use is likewise a significant predictor of prosperity and median income, controlling for other factors. We conclude with a research agenda on digital human capital and community outcomes.
Article
Many governing bodies have launched efforts to shape the operations of manufacturers, administration of civic entities and behavior of individuals to limit waste generation. Typically, such efforts commence with the enactment of targeted legislations that create operational changes (e.g., recycling fees, collection centers) to the waste collection and disposal processes. For example, over 25 states in the USA have enacted legislations that aim to properly dispose used electronic and electrical goods (i.e., e‐waste) and divert such waste away from landfills. We argue that such legislations can have an impact that extends beyond just reducing e‐waste. This is because such laws may not only motivate individuals to restrict e‐waste but also induce broader behavioral spillovers that can prompt individuals to reduce waste in general. To explore this idea, we exploit a quasi‐experimental setup that arises from California’s enactment of the Electronic Waste Recycling Act (EWRA). Specifically, a difference‐in‐differences analysis reveals that the introduction and implementation of the EWRA resulted in at least 4.93% reduction of municipal solid waste (MSW). A plausibility analysis illustrates that these MSW reductions are much larger than what can be attributed purely to the decline of e‐waste. Furthermore, we show that the effect of e‐waste laws is stronger when consumers have increased market access through (i) online connectivity and (ii) offline proximity. Our study informs policy makers on the effects of e‐waste legislation and the critical role of market access in enhancing the impact of such legislation.
Article
Full-text available
This study investigates the relationship between cashless payments and economic growth in selected OECD countries. Using annual data from 2007 to 2016, our results indicate that: Firstly, cashless payment stimulates economic growth in OECD countries. Specifically, the growth-enhancing effect is found in debit card payment while credit card, e-money and cheque payment have no impact on economic growth; Secondly, the positive relationship between economic growth and debit card payment is robust after controlling for the effect of endogeneity, omitted variable bias and outli-ers. Based on the findings, this study offers some imperative policy recommendations.
Article
Full-text available
This article introduces critical perspective into the discussion of the digital divide, which is commonly defined as the gap separating those individuals who have access to new forms of information technology from those who do not. The analysis is distinguished from other undertakings addressing this matter, insofar as it does not document the empirical problems of unequal access but considers the terminology, logical structure, and form that define and direct work on this important social and ethical issue. The investigation employs the tools of critical theory and targets extant texts, reports, and studies. In this way, the analysis does not dispute the basic facts gathered in recent empirical studies of computer usage and internet access. On the contrary, its purpose is to assist these and other endeavors by making evident their common starting point, stakes, and consequences.
Article
Full-text available
High-speed internet access has developed rapidly in the last decade and is increasingly viewed as essential infrastructure for our global information economy.2 For example, as recently as mid-2000 there were only 4.1 million broadband lines in the United States and only 3.2 million of these were residential lines.3 Thus, in mid-2000 less than one household in thirty could access the internet at a download speed of 200 kbps or greater. Six years later, the number of broadband lines, excluding mobile wireless connections, had soared to more than 53.5 million, 49 million of which were in residences. Residential penetration had therefore risen to nearly 50 percent by the middle of last year. (If mobile wireless connections are included, total U.S. broadband lines had risen to more than 64.6 million lines.) While most communications sector analysts concur that the ability to deliver broadband communications is a critical feature of the modern global communications infrastructure, there is limited recent empirical research on the economic effects of broadband. In particular, much of the available research is now several years old or refers to the benefits of the Internet generally or more broadly of the "digital economy" rather than to the broadband telecommunications infrastructure per se.4
Article
Full-text available
Broadband access is needed for the Internet to achieve its full potential, and how these services are offered is likely to have important implications for the extent of competition for communication services in the last mile. This paper describes a research project of the MIT Internet & Telecoms Convergence Consortium (ITC) 1 into local Internet access and presents initial results from our empirical survey of the patterns of deployment for broadband Internet access in the United States, focusing on xDSL and cable modems as the two technologies that have been deployed most extensively to date. We were unable to find much evidence of residential xDSL deployments through the end of 1998; however, we did identify over 805 communities where cable modem services are now available. The demographics of these communities suggest that to date that these services are still not widely available, and where available, are concentrated in higher income, higher density markets --as might be expected for a new technology. Moreover, when broadband access is available, consumers are unlikely to face competitive alternatives for providers. And, finally, the identity of the cable television provider has had an important impact on the likelihood that cable modems will be available. We suspect this result reflects differences in strategic decisions based on differing views of the attractiveness of broadband services and earlier decisions on the timing and extent of system upgrades. For example, MediaOne has been substantially more aggressive in deploying cable modem services than have carriers with typically lower-quality outside plant, such as Cablevision and TCI. While these results are not surprising, they are nevertheless important in helping to establish a baseline for continued research and in suggesting additional data requirements and questions that need to be examined to more fully understand the evolution of Internet access. In addition to the empirical data presented, we describe our future research agenda., a multi-disciplinary, joint industry-academic research effort to study the economic, technical, business, and policy issues that arise as a consequence of the convergence of telecommunications and the Internet. For further information, see http://itel.mit.edu.
Article
Full-text available
As broadband—or high-speed—Internet use has spread, Internet applications requiring high transmission speeds have become an integral part of the “Information Economy,” raising concerns about those who lack broadband access. This report analyzes (1) rural broadband use by consumers, the community-at-large, and businesses; (2) rural broadband availability; and (3) broadband’s social and economic effects on rural areas. It also summarizes results from an ERS-sponsored workshop on rural broadband use, and other ERS-commissioned studies. In general, rural communities have less broadband Internet use than metro communities, with differing degrees of broadband availability across rural communities. Rural communities that had greater broadband Internet access had greater economic growth, which conforms to supplemental research on the benefits that rural businesses, consumers, and communities ascribe to broadband Internet use.
Article
Full-text available
This paper uses data for eight manufacturing industries to test for and characterize dynamic production externalities in cities. The authors find evidence of both Marshall-Arrow-Romer (MAR) externalities, which are associated with past own industry employment concentration, and Jacobs externalities, which are associated with past diversity of local total employment. For mature capital goods industries, there is evidence of MAR externalities but none of Jacobs externalities. For new high-tech industries, there is evidence of Jacobs and MAR externalities. These findings are consistent with the notion that new industries prosper in large, diverse metropolitan areas but, with maturity, production decentralizes to smaller, more specialized cities. Copyright 1995 by University of Chicago Press.
Article
Full-text available
How much economic value did the diffusion of broadband create? We provide benchmark estimates for 1999 to 2006. We observe $39 billion of total revenue in Internet access in 2006, with broadband accounting for $28 billion of this total. Depending on the estimate, households generated $20 to $22 billion of the broadband revenue. Approximately $8.3 to $10.6 billion was additional revenue created between 1999 and 2006. That replacement is associated with $4.8 to $6.7 billion in consumer surplus, which is not measured via Gross Domestic Product (GDP). An Internet-access Consumer Price Index (CPI) would have to decline by 1.6% to 2.2% per year for it to reflect the creation of value. These estimates both differ substantially from those typically quoted in Washington policy discussions, and they shed light on several broadband policy issues, such as why relying on private investment worked to diffuse broadband in many US urban locations at the start of the millennium.
Article
Full-text available
Did the diffusion of the Internet lead to convergence or divergence of local wages? We examine the relationship between business use of advanced Internet technology and regional variation in US wage growth between 1995 and 2000.We show that business use of advanced Internet technology is associated with wage growth but find no evidence that the Internet contributed to regional wage convergence. Advanced Internet technology is only associated with wage growth in places that were already well off in terms of income, education, population, and industry. Overall, advanced Internet explains one-quarter of the difference in wage growth between these counties and all others.
Article
Full-text available
Using extensive data on 1970 and 1987 urban characteristics, the paper analyzes changes in employment in specific manufacturing industries in cities between 1970 and 1987. Two sets of questions are the focus. First, what present or past characteristics of a city's economic environment are critical in determining current employment levels in different industries? How much persistence in employment patterns is there over time and what is the source of that persistence? The second set of questions explores what inferences can be made from the data and results concerning the nature of externalities in urban markets, involving diversity of suppliers to firms, information spillovers concerning current market conditions and information spillovers involving the spread of technology. While the literature assumes employment levels in individual industries in individual cities show strong mean reversion ("convergence"), in fact that is not the case in the 1970-87 time period. The raw data show strong persistence. The major source of that persistence appears to be persistence in local demand conditions (i.e., persistence in regional comparative advantage), as opposed to other measured or unmeasured urban characteristics. Retention of employment is also strongly helped by the historical degree of local specialization in the industry, perhaps indicating a form of dynamic externality. Other historical conditions are not important.
Article
Full-text available
We investigate the role of broadband access on the probability of telecommuting and whether individuals who work from home receive greater compensation. We also assess whether telecommuting differs between more- and less-densely populated areas. Telecommuting responds positively to local average commuting time and to local access to High-Speed Internet service. Differences in broadband access explain three-fourths of the gap in telecommuting between urban and rural markets. Telecommuters and other IT users do not earn significantly more than otherwise observationally comparable workers. Already highly skilled and highly paid workers are the most likely to telecommute and so they do not earn more because they telecommute. As broadband access improves in rural markets, the urban-rural gap in telecommuting will diminish. The urban-rural pay gap will also decrease if improved broadband access induces some already highly paid urban workers to move to rural areas.
Article
Full-text available
Significant resources are being invested by government and the private sector in broadband infrastructure to increase broadband deployment and use. With a unique dataset of broadband availability (sorted by county), the authors assess whether broadband infrastructure has affected the industrial competitiveness of Kentucky counties. Their results suggest that broadband availability increases employment growth in some industries but not others.
Article
This paper constructs a framework for modeling the determinants of broad band availability in the United States, and applies it to a zip code-level database of economic, demographic, geophysical, and policy variables constructed by the author. Statistically significant state effects exist, suggesting that, after controlling for a long list of economic and demographic factors, state-level policies appear to have played a role in accelerating or retarding broadband deployment. I find that geophysical variables are important determinants of differences in broadband availability across zip codes, presumably because of their effects on broadband deployment costs. My results here suggest that omitting these variables from supply side analyses is likely to result in significant estimation biases in empirical econometric work. Geophysical variables are also excellent candidates for use as instruments in future work on broadband demand, where dealing with unmeasured variation in quality of service chosen by consumers is clearly an important problem for researchers, and availability of instrumental variables to deal with this issue has been problematic. Interesting results on the impact of a variety of socioeconomic variables on broadband deployment are available. Income and wealth variables unsurprisingly seem to be among the determinants of lack of broadband availability, but population density’s role is much more problematic. When a full set of explanatory variables is used, the results suggest that absolute market size, not some measure of density relative to physical area, is the key determinant. I note that the 'digital divide' reducing African American use of broadband, cet. par., seems to have vanished. A statistically significant impact of the eRate (Universal Service Fund) program linking schools and libraries was evident in 2005, with a positive impact on reducing areaswithout broadband service.
Article
This paper updates my May 2008 analysis of cross-country broadband data where new information is available. Household broadband adoption continues to increase quickly in all OECD countries. U.S. household broadband penetration increased from 47 percent in March 2007 to 63 percent in April 2009, meaning the U.S. ranks somewhere between 8th and 10th in household broadband penetration among OECD countries. If current trends continue, the U.S. and nearly all wealthy OECD countries will reach a saturation point within the next few years. Speeds continue to increase around the world. Four OECD countries — Korea, Japan, Sweden, and the Netherlands at 18, 15, 12, and 9.4 mbps — had average download speeds well above others in the first quarter of 2009. Another 12 countries had average download speeds between 6 and 8 mbps, including the U.S. with an average of 6.4 mbps. Though the U.S. has, on average, slower download speeds than some other countries, consumers in the U.S. download far more movies and music per capita via the Internet than do consumers in the U.K, France, Germany, Italy, Canada, or Japan (the only countries considered in a recent Ofcom study), suggesting that these speeds are not seriously hindering growth in online video. In terms of prices, the U.S. appears to have among the least expensive low-end broadband plans but among the more expensive high-end plans. More broadly, the U.S. remains at or near the top of many other ICT indicators including the latest estimates of IT investment.
Article
The steady growth of broadband penetration in the United States is indicative of a major shift in advanced data services and last-mile infrastructure in the deregulated telecommunication environment. Although there are concerns with the equitable provision of broadband services in urban, rural and remote areas, the diffusion process has also created a unique landscape of broadband availability that reflects elements of competition, federal policy, local government initiatives, technological limitations and location. This paper explores the dynamic and diverse spatial landscape of broadband availability in the United States at the zip code level, for 2004. In addition, this study provides a multivariate, spatial taxonomy of broadband regions, highlighting their socioeconomic and demographic differences.
Article
Most intraurban location models in urban economics are based on a a priori assumption that employment is exogenous and a determinant of residential location. In this paper this assumption is relaxed or tested by estimating a dynamic model using pooled cross-sectional time-series data; the results suggest that causality runs from residence to employment, not vice versa.
Article
The only comprehensive published indicator of residential broadband availability in the US is number of providers in each ZIP code, as reported by the Federal Communications Commission (FCC). This measure has been widely used in academic and policy research to assess availability and to identify under-served areas, but it is acknowledged to be flawed and is often misinterpreted.This paper develops an alternative measure of residential broadband availability. Using the December 2005 FCC data and individual broadband adoption data from Forrester Research, the paper estimates a relationship between the number of providers in a ZIP code and the level of residential broadband availability in the ZIP code.Broadband is estimated to be available to 53% of households in ZIP codes with 1–3 providers, rising to 100% in ZIP codes with 14 or more providers. Aggregating these estimates at the national level implies that broadband was available to 85% of households in December 2005. Availability was highest in southern and western metropolitan areas like Miami and San Jose. Using these estimates of availability, population density and average income both have positive and highly statistically significant effects on broadband supply.The results provide a user-friendly tool to help policymakers assess broadband availability. The estimates are also useful for future research about the effects of broadband availability.
Article
Economic research on industry location and agglomeration has focused nearly exclusively on manufacturing. This paper shows that services are prominent among the most agglomerated industries, especially at the county level. Because traditional measures of knowledge spillovers, natural resource inputs, and labor pooling explain little of agglomeration in services industries, this paper takes an alternative approach and looks at co-agglomeration to assess why industries cluster together. By considering the location patterns of pairs of industries instead of individual industries, the traditional agglomeration explanations can be measured more richly, and additional measures – like the need to locate near suppliers or customers – can be incorporated. The results show that co-agglomeration between pairs of services industries is driven by knowledge spillovers and the direct trading relationship between the industries, especially at the zip code level. Information technology weakens the need for services industries to co-agglomerate at the state level, perhaps because electronic transport of services outputs lowers the value of longer-distance proximity. These results are in sharp contrast to results for manufacturing, for which labor pooling contributes most to co-agglomeration, and the direct-trading relationship contributes more to state-level co-agglomeration. These differences between services and manufacturing are consistent with simple models of transport costs.
Article
Recent theories of economic growth, including those of P. Romer (1986, 1990), M. Porter (1990), and J. Jacobs (1969, 1984), have stressed the role of technological spillovers in generating growth. Because such knowledge spillovers are particularly effective in cities, where communication between people is more extensive, data on the growth of industries in different cities allow the authors to test some of these theories. Using a new data set on the growth of large industries in 170 U.S. cities between 1956 and 1987, they find that local competition and urban variety, but not regional specialization, encourage employment growth in industries. The evidence suggests that important knowledge spillovers might occur between rather than within industries. Copyright 1992 by University of Chicago Press.
Article
Residential broadband options such as cable and digital subscriber lines are growing in popularity. However, evidence suggests that urban areas are receiving the majority of infrastructure investment, thereby leaving many rural locations with few options for broadband access. With access to telecommunication infrastructure becoming an increasingly important component to local economic development, issues of infrastructure equity are significant. This paper explores telecommunication equity and its effect on economic development by addressing the impact of geography on infrastructure investment and growth. A comprehensive database of broadband service providers and data from the Ecom-Ohio project (http://www.ecom-ohio.org), are used to explore broadband access options in the state of Ohio by examining the characteristics of market demand that are driving cable and digital subscriber line infrastructure investment. In addition, this paper develops an explanatory framework for identifying key market characteristics indicative of demand for residential broadband services through the use of statistical models and a geographic information system. Results suggest that income, education, age, location, and competition from alternative broadband platforms influence digital subscriber line infrastructure investment. Copyright Springer-Verlag Berlin Heidelberg 2003
Article
Should government rebuild New Orleans? Edward Glaeser asks whether the residents would be better off with $200,000 in their pockets than to have $200 billion spent on infrastructure: shouldn't we be insuring the people, not the place? New Orleans has been declining and its people mired in poverty for decades; its port and pipelines cannot employ a large city, and $200 billion is unlikely to change that.
Article
The newest dimension of the digital divide is access to broadband (high-speed) Internet service. Using comprehensive U.S. data covering all forms of access technology (chiefly DSL and cable modem), I look for evidence of unequal broadband availability in areas with high concentrations of poor, minority, or rural households. There is little evidence of unequal availability based on income or on black or Hispanic concentration. There is mixed evidence concerning availability based on Native American or Asian concentration. Other findings: Rural location decreases availability; market size, education, Spanish language use, commuting distance, and Bell presence increase availability. Copyright 2003, Oxford University Press.
Article
With the passage of the Telecommunications Act of 1996, Congress directed the Federal Communications Commission and all fifty U.S. states to encourage the deployment of advanced telecommunication capability in a reasonable and timely manner. Today, with the rollout of advanced data services such as digital subscriber lines (xDSL), cable modems, and fixed wireless technologies, broadband has become an important component of telecommunication service and competition. Unfortunately, the deployment of last-mile infrastructure enabling high-speed access has proceeded more slowly than anticipated and competition in many areas is relatively sparse. More importantly, there are significant differences in the availability of broadband services between urban and rural areas. This paper explores aspects of broadband access as a function of market demand and provider competition. Data collected from the Federal Communications Commission is analyzed using a geographic information system and spatial statistical techniques. Results suggest significant spatial variation in broadband Internet access as a function of provider competition in the United States. Copyright 2004 Gatton College of Business and Economics, University of Kentucky..
Article
The monocentric urban model highlights the important link between transportation access and urban form. Yet as metropolitan areas have become increasingly multicentric, the monocentric model has been criticized on several levels. This paper tests an important assumption used in many monocentric models-namely that employment location is exogenous to population location within an urban area. Using data on population and employment changes in a group of New Jersey municipalities, this work shows that employment changes are endogenous to the population change in a surrounding labor market. This suggests that urban models should give more attention to the problem of employment location within metropolitan areas.
Article
This paper uses data on the geographic diffusion of commercial internet usage to reconcile the fact that internet adoption is higher in larger cities with the widespread claim that the internet substitutes for the advantages of cities. Three hypotheses are considered. First is that the convention wisdom is just plain wrong, and the internet is 1
Broadband Deployment Is Extensive throughout the United States, but It Is Difficult to Assess the Extent of Deployment Gaps in Rural Areas
  • Accountability Government
  • Office
Government Accountability Office. 2006. Broadband Deployment Is Extensive throughout the United States, but It Is Difficult to Assess the Extent of Deployment Gaps in Rural Areas. GAO‐06‐426. Report to congressional committees.
The Effects of Broadband Deployment on Output and Employment: A Cross‐sectional Analysis of U.S. Data Issues in Economic Policy discussion paper no. 6. Brookings Institution
  • Robert Crandall
  • William Lehr
  • Robert Litan
Crandall, Robert, William Lehr, and Robert Litan. 2007. " The Effects of Broadband Deployment on Output and Employment: A Cross‐sectional Analysis of U.S. Data. " Issues in Economic Policy discussion paper no. 6. Brookings Institution. Available at http://www.brookings.edu/~/media/Files/rc/papers/2007/06labor_crandall/06labor_crandall.pdf.
The Effects of Ubiquitous Broadband Adoption on Investment, Jobs, and the U.S. Economy Criterion Economics, L.L.C. Released by New Millennium Research Council
  • Robert Crandall
  • Charles Jackson
  • Hal Singer
Crandall, Robert, Charles Jackson, and Hal Singer. 2003. " The Effects of Ubiquitous Broadband Adoption on Investment, Jobs, and the U.S. Economy. " Criterion Economics, L.L.C. Released by New Millennium Research Council. Available at http://newmillenniumresearch.org/archive/bbstudyreport_091703.pdf.
The Economic Impact of Municipal Broadband
  • Carlos Osorio
Osorio, Carlos. 2006. "The Economic Impact of Municipal Broadband." Unpublished manuscript.
Economic Effects of Increased Broadband Usage in California
  • Van Gaasbeck
  • Stephen Kristin
  • Ryan Perez
  • Helen Sharp
  • Angela Schaubmayer
  • Lindsay Owens
  • Cox
Van Gaasbeck, Kristin, Stephen Perez, Ryan Sharp, Helen Schaubmayer, Angela Owens, and Lindsay Cox. 2007. Economic Effects of Increased Broadband Usage in California. Summary report, Sacramento Regional Research Institute.
Can Buffalo Ever Come Back?
  • Edward Glaeser
Glaeser, Edward. 2007. "Can Buffalo Ever Come Back?" City Journal 17 (4). Available at http://www.cityjournal.org/html/17_4_buffalo_ny.html.
  • Edward Glaeser
  • Hedi Kallal
  • Jose Scheinkman
  • Andrei Shleifer
Glaeser, Edward, Hedi Kallal, Jose Scheinkman, and Andrei Shleifer. 1992. " Growth in Cities. " Journal of Political Economy 100 (6).
Measuring the Economic Impact of Broadband Deployment
  • Sharon Gillett
  • William Lehr
  • Carlos Osorio
  • Marvin Sirbu
Gillett, Sharon, William Lehr, Carlos Osorio, and Marvin Sirbu. 2006. "Measuring the Economic Impact of Broadband Deployment." U.S. Department of Commerce, Economic Development Administration.