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Broadband Internet and Income Inequality

Author

Listed:
  • Houngbonon Georges V.

    (Laboratoire de Genie Industrielle, Gif-sur-Yvette, France)

  • Liang Julienne

    (Groupe Orange, 78 Rue Olivier de Serres, 75015Paris, France)

Abstract

Digital technologies like the Internet can affect income inequality through increased demand for employment in manual and abstract jobs and reduced demand for employment in routine jobs. In this paper, we combine city-level income distribution and jobs data with broadband data from France to investigate the impact of broadband Internet access on income inequality. Using an instrumental variable estimation strategy, we find that broadband Internet reduces income inequality through increased employment in manual jobs. These effects increase with the availability of skilled workers and are significant in cities with a large service sector or high-speed Internet access. Further, the diffusion of broadband Internet comes with relatively greater benefits in low-income cities compared to high-income cities. Several robustness checks support these findings.

Suggested Citation

  • Houngbonon Georges V. & Liang Julienne, 2021. "Broadband Internet and Income Inequality," Review of Network Economics, De Gruyter, vol. 20(2), pages 55-99, June.
    • Handle: RePEc:bpj:rneart:v:20:y:2021:i:2:p:55-99:n:2
    DOI: 10.1515/rne-2020-0042
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    More about this item

    Keywords

    broadband internet; income distribution; employment;
    All these keywords.

    JEL classification:

    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • L96 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Telecommunications
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration
    • J20 - Labor and Demographic Economics - - Demand and Supply of Labor - - - General

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