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Broadband internet availability and establishments' employment growth in Germany : evidence from instrumental variables estimations

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  • Stockinger, Bastian

    (Institute for Employment Research (IAB), Nuremberg, Germany)

Abstract

"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." (Author's abstract, © Springer-Verlag) ((en))

Suggested Citation

  • Stockinger, Bastian, 2019. "Broadband internet availability and establishments' employment growth in Germany : evidence from instrumental variables estimations," Journal for Labour Market Research, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany], vol. 53(1), pages 1-7.
    • Handle: RePEc:iab:iabjlr:v:53:p:art.07
    DOI: 10.1186/s12651-019-0257-0
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    References listed on IDEAS

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    1. Anders Akerman & Ingvil Gaarder & Magne Mogstad, 2015. "The Skill Complementarity of Broadband Internet," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 130(4), pages 1781-1824.
    2. Falck, Oliver & Heimisch-Roecker, Alexandra & Wiederhold, Simon, 2021. "Returns to ICT skills," Research Policy, Elsevier, vol. 50(7).
    3. Haller, Stefanie A. & Lyons, Sean, 2019. "Effects of broadband availability on total factor productivity in service sector firms: Evidence from Ireland," Telecommunications Policy, Elsevier, vol. 43(1), pages 11-22.
    4. Glenn Ellison & Sara Fisher Ellison, 2009. "Tax Sensitivity and Home State Preferences in Internet Purchasing," American Economic Journal: Economic Policy, American Economic Association, vol. 1(2), pages 53-71, August.
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    Cited by:

    1. Shi, Zheng, 2023. "The impact of regional ICT development on job quality of the employee in China," Telecommunications Policy, Elsevier, vol. 47(6).
    2. Yifeng Philip Chen & Edward J. Oughton & Jakub Zagdanski & Maggie Mo Jia & Peter Tyler, 2023. "Crowdsourced data indicates broadband has a positive impact on local business creation," Papers 2308.14734, arXiv.org.
    3. Elizabeth A. Mack & Scott Loveridge & Thomas Keene & John Mann, 2024. "A Review of the Literature About Broadband Internet Connections and Rural Development (1995-2022)," International Regional Science Review, , vol. 47(3), pages 231-292, May.
    4. Xiumei Wang & Yongjian Huang & Yingying Zhao & Jingxuan Feng, 2023. "Digital Revolution and Employment Choice of Rural Labor Force: Evidence from the Perspective of Digital Skills," Agriculture, MDPI, vol. 13(6), pages 1-19, June.
    5. Anil Rupasingha & John Pender & Ryan Williams, 2024. "Broadband and rural development: Impacts of the U.S. Department of Agriculture Broadband Initiatives Program on saving and creating jobs," Economic Inquiry, Western Economic Association International, vol. 62(2), pages 698-721, April.
    6. Falk, Martin & Hagsten, Eva, 2021. "Impact of high-speed broadband access on local establishment dynamics," Telecommunications Policy, Elsevier, vol. 45(4).
    7. Filippo Pusterla & Ursula Renold, 2022. "Does ICT affect the demand for vocationally educated workers?," Swiss Journal of Economics and Statistics, Springer;Swiss Society of Economics and Statistics, vol. 158(1), pages 1-22, December.
    8. Filippo Pusterla & Thomas Bolli, 2019. "Is Technological Change Really Skills-Biased? Firm-level Evidence of the Complementarities between ICT and Workers’ Education," KOF Working papers 19-468, KOF Swiss Economic Institute, ETH Zurich.

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    More about this item

    Keywords

    Bundesrepublik Deutschland ; Ostdeutschland ; Westdeutschland ; IAB-Open-Access-Publikation ; Auswirkungen ; Beschäftigungseffekte ; Beschäftigungsentwicklung ; Dienstleistungsbereich ; IAB-Betriebs-Historik-Panel ; Infrastruktur ; Internet ; produzierendes Gewerbe ; regionaler Arbeitsmarkt ; regionaler Vergleich ; 2005-2010;
    All these keywords.

    JEL classification:

    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population

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