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The economic impact of broadband: Evidence from OECD countries

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  • Koutroumpis, Pantelis

Abstract

Information networks have a significant impact on modern economies. This is reflected by their adoption and use across countries along with the increasing quality of the networks. As a result, the impacts on the economy are driven both by the level of adoption and the quality of the connections. Looking at the OECD countries between 2002 and 2016, I find a consistent effect of broadband adoption on national economic output with diminishing returns to scale. I also find that speed is a moderator of these effects and identify a speed threshold, beyond which further quality increases are deemed unproductive. This speed-threshold increases over time as more applications and skills become available. The measurement of adoption levels and speeds helps formulate a policy tool that guides the development of new communications networks. It also shapes the key priorities in terms of their coverage and quality trade-offs.

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  • Koutroumpis, Pantelis, 2019. "The economic impact of broadband: Evidence from OECD countries," Technological Forecasting and Social Change, Elsevier, vol. 148(C).
    • Handle: RePEc:eee:tefoso:v:148:y:2019:i:c:s004016251930112x
    DOI: 10.1016/j.techfore.2019.119719
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    2. Ryota Nakatani, 2023. "Productivity drivers of infrastructure companies: Network industries utilizing economies of scale in the digital era," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 94(4), pages 1273-1298, December.
    3. Bai, Yang & Wang, Ryan Yang & Jayakar, Krishna, 2022. "What $2.5 billion can buy: The effect of the Broadband Initiatives Program on farm productivity," Telecommunications Policy, Elsevier, vol. 46(7).
    4. Elias Aravantinos & Dimitris Varoutas, 2022. "A revisit of fixed and mobile broadband diffusion in the OECD: a new classification," Netnomics, Springer, vol. 22(2), pages 71-84, October.
    5. Edward J Oughton & Niccol`o Comini & Vivien Foster & Jim W Hall, 2021. "Policy choices can help keep 4G and 5G universal broadband affordable," Papers 2101.07820, arXiv.org, revised Feb 2021.
    6. Mugabe Roger & Liu Shulin & Brima Sesay, 2022. "ICT Development, Innovation Diffusion and Sustainable Growth in Sub-Saharan Africa," SAGE Open, , vol. 12(4), pages 21582440221, October.
    7. Philip Chen & Edward J Oughton & Pete Tyler & Mo Jia & Jakub Zagdanski, 2020. "Evaluating the impact of next generation broadband on local business creation," Papers 2010.14113, arXiv.org.
    8. Bo Li & Jing Liu & Qian Liu & Muhammad Mohiuddin, 2022. "The Effects of Broadband Infrastructure on Carbon Emission Efficiency of Resource-Based Cities in China: A Quasi-Natural Experiment from the “Broadband China” Pilot Policy," IJERPH, MDPI, vol. 19(11), pages 1-27, May.
    9. Oughton, Edward J. & Comini, Niccolò & Foster, Vivien & Hall, Jim W., 2022. "Policy choices can help keep 4G and 5G universal broadband affordable," Technological Forecasting and Social Change, Elsevier, vol. 176(C).
    10. Aravantinos, Elias & Petre, Konstantin & Katsianis, Dimitris & Varoutas, Dimitris, 2021. "Determinants of FTTH tariffs evolution in EU: A panel data analysis," Telecommunications Policy, Elsevier, vol. 45(10).
    11. Davide Quaglione & Dario D’Ingiullo & Linda Meleo, 2023. "Fixed and mobile broadband penetration and CO2 emissions: evidence from OECD countries," Economia Politica: Journal of Analytical and Institutional Economics, Springer;Fondazione Edison, vol. 40(3), pages 795-816, October.
    12. Li, Yutao & Zhang, Jinning & Lyu, Yanwei, 2023. "Does telecommunications infrastructure promote entrepreneurship in developing countries? Evidence from a quasi-natural experiment in China," Structural Change and Economic Dynamics, Elsevier, vol. 66(C), pages 106-119.
    13. Feng, Yuan & Chen, Zhi & Nie, Changfei, 2023. "The effect of broadband infrastructure construction on urban green innovation: Evidence from a quasi-natural experiment in China," Economic Analysis and Policy, Elsevier, vol. 77(C), pages 581-598.
    14. Briglauer, Wolfgang & Dürr, Niklas & Gugler, Klaus, 2021. "A retrospective study on the regional benefits and spillover effects of high-speed broadband networks: Evidence from German counties," International Journal of Industrial Organization, Elsevier, vol. 74(C).
    15. Zhou, Fengxiu & Wen, Huwei & Lee, Chien-Chiang, 2022. "Broadband infrastructure and export growth," Telecommunications Policy, Elsevier, vol. 46(5).

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