Broadband speed and unemployment rates: Data and measurement issues. (February 2020)

• Record Type: Journal Article
• Authors: Lobo, Bento J.; Alam, Md Rafayet; Whitacre, Brian E.
• Is Part Of: Telecommunications policy. Volume 44:Number 1(2020)
• Publication Date: 2020-02
• Subjects: Broadband speed -- Unemployment rates -- Selection bias -- Endogeneity -- Rural counties; E24 -- O18 -- J64 -- C23 -- D12; Telecommunication -- Periodicals; Télécommunications -- Périodiques; 384
• DOI: 10.1016/j.telpol.2019.101829
• Languages: English
• ISSNs: 0308-5961

Abstract

Abstract: We examine the effects of broadband speed on county unemployment rates in the U.S. state of Tennessee. We merge the older National Broadband Map dataset and the newer FCC dataset in lengthening our broadband access data over the period 2011–2015. Extending the dataset improves the precision of the estimates. Our panel regressions control for potential selection bias and reverse causality and show that broadband speed matters: unemployment rates are about 0.26 percentage points lower in counties with high speeds compared to counties with low speeds. Ultra-high speed broadband also appears to reduce unemployment rates; however, we are unable to distinguish between the effects of high and ultra-high speed broadband. We document beneficial effects of the early adoption of high speed broadband on unemployment rates. Better quality broadband appears to have a disproportionately greater effect in rural areas. Highlights: We examine the effects of broadband speed on county unemployment rates in the U.S. state of Tennessee. We merge the National Broadband Map and the FCC datasets to get broadband access data over the period 2011-2015. We find that unemployment rates are about 0.26 percentage points lower in high speed counties. We document beneficial effects of the early adoption of high speed broadband on unemployment rates. Better quality broadband appears to have a disproportionately greater effect in rural areas.