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Assessing the Digital Divide and its Regional Determinants: Evidence from a Web-Scraping Analysis

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  • Thonipara, Anita
  • Sternberg, Rolf G.
  • Proeger, Till
  • Haefner, Lukas

Abstract

Following the 'death of distance' postulate, digitization may reduce or even eliminate the penalty of firms being located in rural areas compared with those in urban agglomerations. Despite many recent attempts to measure digitization effects across space, there remains a lack of empirical evidence regarding the adoption of digital technologies from an explicit spatial perspective. Using web-scraping data for a sample of 345,000 small firms in Germany, we analyze the determinants of website prevalence. Comparing urban with rural areas, we show that running a website - as a proxy for the degree of digitization of the respective firm - is highly dependent on location, whereby firms in urban areas are almost twice as likely to run websites compared with those located in rural areas. Our county-level analysis shows that a high population density, a young population and a high educational level have a positive and significant association with the probability that firms run websites. Surprisingly, we find a negative and significant association of gross domestic product per capita with website prevalence, which is driven by urban regions. There are no differences between urban, semi-urban and rural areas in terms of website up-to-dateness as well as social media prevalence. We conclude that there is a substantial digital divide and discuss policy implications.

Suggested Citation

  • Thonipara, Anita & Sternberg, Rolf G. & Proeger, Till & Haefner, Lukas, 2020. "Assessing the Digital Divide and its Regional Determinants: Evidence from a Web-Scraping Analysis," ifh Working Papers 25/2020, Volkswirtschaftliches Institut für Mittelstand und Handwerk an der Universität Göttingen (ifh), revised 2020.
    • Handle: RePEc:zbw:ifhwps:252020
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    Cited by:

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    2. Bischoff, Thore Sören & Alhusen, Harm & Dilekoglu, Kübra, 2021. "Digitalisierung des Handwerks im ländlichen Raum - Relevanz, Prozesse, Treiber und Handlungsbedarfe," Göttinger Beiträge zur Handwerksforschung 61, Volkswirtschaftliches Institut für Mittelstand und Handwerk an der Universität Göttingen (ifh).

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    More about this item

    Keywords

    Digital divide; digitization; rural; Small and Medium-Sized Enterprises; urban; web-scraping;
    All these keywords.

    JEL classification:

    • D22 - Microeconomics - - Production and Organizations - - - Firm Behavior: Empirical Analysis
    • L22 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Organization and Market Structure
    • L26 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Entrepreneurship

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