Impact of Broadband on the Economy

Research to Date and Policy Issues

The diffusion of broadband, defined as the technology that enables high-speed transfer of data, is inextricably linked to the emergence of the Internet. While at its initial stages the Internet was primarily accessed through dial-up means, consumer and enterprise demand prompted the development of technologies that facilitated access at higher speeds. As a result, starting around the mid-1990s, telecommunications and cable TV companies began offering services that significantly enhanced the experience of Internet use. Investment and adoption soared around the world. The purpose of this study is threefold. On one hand, it presents the evidence generated by the different bodies of theory regarding the economic impact of broadband. The purpose is not only to summarize but also to present the complexities and conditions under which broadband has an impact. On the other hand, it reviews the results of research the author has conducted across the world measuring the impact of broadband on economic growth and employment creation. In this context, it presents a methodology for calculating the investment necessary to implement national broadband plans. Finally, it outlines the public policy implications, which can stimulate deployment and maximize the impact of the technology.


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