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Net Neutrality and Investment in the US: A Review of Evidence from the 2018 Restoring Internet Freedom Order

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  • Ford George S.

    (Phoenix Center for Advanced Legal and Economic, 5335 Wisconsin Ave NW, Ste 440, Washington, DC 20015, USA)

Abstract

In 2018, the Federal Communications Commission’s Restoring Internet Freedom Order reversed its 2015 decision to apply common carrier regulation to broadband Internet access services under Title II of the Communications Act of 1934. Empirical evidence indicating negative investment effects of the regulation played a key role in this reversal, though the quantification of these investment effects were a matter of substantial controversy. This article surveys the studies cited in the recent decision and the Commission’s scrutiny of them. In all, the Commission considered eight primary works but relied on only two of them, a culling process that relied on four principles: (1) simply comparing outcomes before-and-after an event is not a valid impact analysis; (2) before-and-after comparisons are more probative if regression analysis is used to condition the outcomes by accounting for potentially relevant factors like economic growth, sales, and so forth; (3) the causal effects of a regulation are best determined with reference to a counterfactual; and (4) the application of proper methods does not excuse the use of bad data. These principles are mostly uncontroversial and are consistent with the modern practice of impact analysis.

Suggested Citation

  • Ford George S., 2018. "Net Neutrality and Investment in the US: A Review of Evidence from the 2018 Restoring Internet Freedom Order," Review of Network Economics, De Gruyter, vol. 17(3), pages 175-205, September.
  • Handle: RePEc:bpj:rneart:v:17:y:2018:i:3:p:175-205:n:2
    DOI: 10.1515/rne-2018-0043
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    References listed on IDEAS

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