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A Need for Speed? Rural Internet Connectivity and the No access / Dial-up / High-speed Decision

Author

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  • Whitacre, Brian E.
  • Mills, Bradford F.

Abstract

As residential high-speed Internet access has become more prevalent, the composition of the "digital divide" between rural and urban households has shifted. In 2000, dial-up access rates in rural household lagged behind their urban counterparts by eleven percent. By 2003, however, dial-up access rates were equal between rural and urban households, due in part to soaring high-speed rates in urban areas. This paper explores the household decision between no Internet access, dial-up access, and high-speed access. In particular, nested logit and multinomial logit specifications are compared. The paper also uses a decomposition technique to estimate the contributions of various factors (including education, income, and infrastructure levels) to each of the "access-specific" divides between rural and urban households. The results suggest that the nested logit is the preferred specification, and that differences in education and income account for the majority of each type of divide.

Suggested Citation

  • Whitacre, Brian E. & Mills, Bradford F., 2006. "A Need for Speed? Rural Internet Connectivity and the No access / Dial-up / High-speed Decision," 2006 Annual meeting, July 23-26, Long Beach, CA 21272, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
  • Handle: RePEc:ags:aaea06:21272
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    File URL: http://ageconsearch.umn.edu/record/21272/files/sp06wh01.pdf
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    References listed on IDEAS

    as
    1. Bradford F. Mills & Brian E. Whitacre, 2003. "Understanding the Non-Metropolitan-Metropolitan Digital Divide," Growth and Change, Wiley Blackwell, vol. 34(2), pages 219-243.
    2. Hausman, Jerry & McFadden, Daniel, 1984. "Specification Tests for the Multinomial Logit Model," Econometrica, Econometric Society, vol. 52(5), pages 1219-1240, September.
    3. Tony H. Grubesic & Alan T. Murray, 2004. "Waiting for Broadband: Local Competition and the Spatial Distribution of Advanced Telecommunication Services in the United States," Growth and Change, Wiley Blackwell, vol. 35(2), pages 139-165.
    4. Nielsen, Helena Skyt, 1998. "Discrimination and detailed decomposition in a logit model," Economics Letters, Elsevier, vol. 61(1), pages 115-120, October.
    5. Hensher, David A. & Greene, William H., 2002. "Specification and estimation of the nested logit model: alternative normalisations," Transportation Research Part B: Methodological, Elsevier, vol. 36(1), pages 1-17, January.
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    Keywords

    Public Economics;

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