Economic impacts of mobile versus fixed broadband

Broadband telecommunication service is growing rapidly and its economic impact is likely to vary considerably around the globe. Considerable interest is being shown in wireless broadband, especially in low income and rural areas. This study focuses on the direct effect (broadband penetration as an input), and separately, the productive efficiency effect of broadband (as an information network externality), using a model developed in Thompson and Garbacz (2007). Aggregate fixed and mobile broadband usage and their effect are analyzed and compared first on a sample of forty-three countries with sufficient data. The same models are used on samples of high income and low income countries. It is hypothesized that the rapid growth of broadband could have a stronger effect for low income countries and their initial levels of network development. Key variables are adjusted to a per household basis, using information on household size. Due to the endogeneity of key variables, instrumental variables are employed to estimate separate equations for mobile broadband and fixed broadband. Predicted values for these variables are used in the final equations in order to adjust for endogeneity and omitted variable bias. The results of the model estimated for the full sample indicate that mobile broadband has an important direct effect on GDP, but fixed broadband has an effect no different than zero. In the models with high and low income samples it is apparent that low income countries derive significantly more benefit from mobile broadband. Estimates from the Stochastic Frontier Model find mobile broadband to be a significant driver of growth via a reduction of inefficiency.     

The impact of ICT patents on economic growth: An international evidence

This study aims to examine the impact of inventions, measured by the number of new patents, on economic growth. Specifically, we focus on patents in the ICT sector for a global sample of 43 economies, comprising 26 advanced and 17 emerging market economies in the period 1998 to 2016. We use a two-step system GMM to control for potential endogeneity in the data. Our results are threefold. First, total patents have mutually causal effects with economic growth, but there is no evidence of an impact of total patents on manufacturing sector growth. At the same time, ICT patents have a unidirectional causal impact on both, overall economic growth, and the growth of services and manufacturing. Second, the impact of total patents on economic growth is stronger in advanced economies. At the same time, ICT patents have a positive significant impact on the growth of advanced economies and a negative significant effect on the growth of emerging economies. Third, in the long-run, ICT patents have a positive significant impact on economic growth, while total patents do not.     

On the regional impact of broadband on productivity: The case of Brazil

This paper analyses the incidence of broadband on regional productivity in Brazil, intending to find out if the economic impact is uniform across all territories of the country. The possibility of performing a regional approach to test the effect of broadband on productivity in an emerging country represents a novelty for the literature. Results suggest that the impact of broadband on productivity is positive although not uniform across regions. On the one hand, it seems to depend on connection quality and network effects. Faster download speed and critical-mass accounting for network externalities in the region enhance the economic impact of broadband. On the other hand, higher productivity gains are estimated for the less developed regions. The fact that the less productive regions in Brazil seem to be benefiting more from broadband may suggest that it can constitute a factor favoring regional convergence in the country.     

Small is big in ICT: The impact of R&D on productivity

We examine the contribution of R&D to firm productivity in a large panel of European firms and study its variation with the age, size, and sub-sector of firms. We find that R&D capital in ICT firms has a larger effect on revenue when compared to non-ICT firms. At the firm level, our results suggest that, surprisingly, smaller and older ICT firms benefit the most from R&D. Small but mature ICT firms are likely to dominate market niches, and small size may enable them to be flexible and adaptable which helps them respond to technological opportunities to develop innovative products and services. This has important implications for public policy based upon firm age.     

Determinants of mobile broadband use in developing economies: Evidence from Sub-Saharan Africa

Broadband is seen as a vector of economic growth and social development. In the developing world, mobile technologies are widely adopted and mobile broadband is progressively rolled-out with high expectations on its impact on the countries’ development. We highlight what the determinants of mobile broadband use are in four Sub-Saharan countries. Using micro-level data coming from household surveys over 5 years, from 2013 to 2017, we show that SIM card ownership and being part of an online social community has a strong positive impact on mobile broadband use. We also highlight a positive correlation between digital inclusion and financial inclusion as mobile money users and bank account users are found to be more inclined to use mobile broadband. However, beyond apparent similarities, mobile broadband is used in different ways according to countries specificities. For instance, among the non-mobile owners in Nigeria, the unemployed are the most likely to use mobile broadband, most probably for job search practices, while it is rather used by students for information gathering in other countries. Finally we show that those excluded from mobile broadband use are the eldest, those with the lowest level of education, and women.     

The economic impact of broadband on growth: A simultaneous approach

This paper investigates how broadband penetration affects economic growth. A macroeconomic production function with a micro-model for broadband investment is used to estimate the impact of broadband infrastructure and growth. The results indicate a significant causal positive link especially when a critical mass of infrastructure is present. The scope of this research is 22 OECD countries based on data collected for the period 2002–2007.     

ICT as a driver of economic growth: A survey of the literature and directions for future research

This paper conducts a comprehensive literature survey of the papers that examine the link between ICT and economic growth. Using a rigorous screening framework, we found 208 academic papers that were published from 1991 to the cutoff date of October 30, 2018.This survey provides a robust set of insights into the distribution, research strategies, and findings of the surveyed papers, taking into account their geographic focus and type of ICT-growth links. This study also reveals the key factors that predict the citation impact by paper. Among the directions for future research, this paper argues that the time has come for the research on the ICT-growth link to shift its main focus from evidencing its positive relationship to advancing the understanding on why and how emerging digital technologies directly or indirectly affect economic performance.     

Evaluating the impact of broadband access and internet use in a small underserved rural community

Having adequate access to the internet at home enhances quality-of-life for households and facilitates economic and social opportunities. Despite increased investment in response to the COVID-19 pandemic, millions of households in the rural United States still lack adequate access to high-speed internet. In this study, we evaluate a wireless broadband network deployed in Turney, a small, underserved rural community in northwest Missouri. In addition to collecting survey data before and after this internet intervention, we collected pre-treatment and post-treatment survey data from comparison communities to serve as a control group. Due to technical constraints, some of Turney's interested participants could not connect to the network, creating an additional comparison group. These comparisons suggest two primary findings, (1) changes in using the internet for employment, education, and health could not be directly attributed to the internet intervention, and (2) the internet intervention was associated with benefits stemming from the ability to use multiple devices at once. This study has implications for the design of future broadband evaluation studies, particularly those examining underserved rather than unserved communities. Recommendations for identifying appropriate outcome variables, executing recruitment strategies, and selecting the timing of surveys are made.     

Convergence and determinants of ICT development in case of emerging market economies

This paper aims to examine the convergence of ICT development in the case of 27 emerging market economies (EMEs) using annual data from 2000 to 2018. First, by employing Phillips-Sul (PS) panel convergence test, the results not only support the evidence of convergence in ICT development but also find convergence in the composition of ICT development known as ICT access and ICT use. Second, the study identifies factors such as per capita income, human capital, and FDI which significantly affect ICT development. Third, results based on stochastic conditional convergence reveal that EMEs countries are not only converging among themselves but also ‘catch-up’ to the OECD countries.     

The role of mobile network operators in next-generation public safety services

Field of researchThis research is in the field of public safety communications in mobile broadband 4G/5G networks. The focus is on mobile network operators and their business opportunities in the public safety market.PurposeThe purpose of this research is to provide a review of ongoing public safety mobile broadband projects in which mobile operators play a key role. In addition, a business model analysis is presented to determine the role of mobile operators in these projects. A comparison of the two key business models is also included to reveal their general characteristics.Methods and dataThe research used a qualitative method, an inductive case study. This method was used to draw general conclusions from a small number of case studies based on ongoing public safety mobile broadband projects. The Casadesus-Masanell and Ricart framework and the business model canvas were used to analyse and compare the two key business models discussed. Data were collected from a variety of sources, including company reports, press releases, international events and conferences, and selected interviews with managers in charge.FindingsThe results show that mobile operators have new business opportunities in the public safety market. Their existing mobile networks can be used for public safety services with certain enhancements. Within existing projects, mobile operators have different business models. The two analysed models were found to require different resources and offer different business opportunities for mobile operators. Procurement authorities responsible for selecting business models are encouraged to pay attention to the choice of model based on, for example, strategic objectives.ValueVery little research has been done on the business opportunities of mobile operators in the public safety market. In this area, this study lays the groundwork for new research. Procurement authorities can use the results when deciding on the business model. Mobile operators can benefit from these results by better understanding their own roles in public safety projects and when assessing the business opportunities of a particular project.     

ICT as a source of economic growth in the information age: Empirical evidence from the 1996-2005 period

This paper examines the hypothesis that ICT penetration has positive effects on economic growth. On theoretical grounds, this paper discusses three channels through which ICT penetration can affect growth: (i) fostering technology diffusion and innovation; (ii) enhancing the quality of decision-making by firms and households; and (iii) increasing demand and reducing production costs, which together raises the output level. This paper conducts three empirical exercises to provide a comprehensive documentation of the role of ICT as a source of growth in the 1996-2005 period. The first exercise shows that growth in 1996-2005 improved relative to the previous two decades and experienced a very significant structural change. The second exercise uses the traditional cross-country regression method to identify a strong association between ICT penetration and growth during 1996-2005, controlling for other potential growth drivers and country-fixed effects. The third exercise uses the system Generalized Method of Moment (GMM) for dynamic panel data analysis to tease out the causal link between ICT penetration and growth. This analysis also shows that, for the average country, the marginal effect of the penetration of internet users was larger than that of mobile phones, which in turn is larger than that of personal computers. The marginal effect of ICT penetration, however, lessens as the penetration increases. This paper points out several policy implications drawn from its analyses and findings.     

The impact of regulating mobile termination rates and MNO-MVNO relationships on retail prices

A mobile virtual network operator (MVNO) provides mobile telecommunication services by eluding the constraints of the radio communication infrastructure and establishing an agreement with a hosting network operator (HNO) for the use of its spectrum. Thus, MVNOs offer a wide range of mobile services and directly compete with every mobile network operator (MNO). This paper studies the economic justifications for potential regulatory intervention that defines the level of mobile termination rates (MTRs) and negotiations and agreements among MVNOs and HNOs. The results show that symmetric MTR reduction leads to competition growth among operators, forcing every operator to reduce retail prices and, consequently, to enhancing consumer welfare. The paper also finds that a collaborative strategy adopted by an HNO and an MVNO is advantageous for both and induces a reduction in retail prices, thus weakening other MNOs.     

The impact of license duration on tangible investments of mobile operators

Using data from the WCIS (World Cellular Information Service) and the Telecoms Market Matrix of Analysis Mason, we were able to build a database relating the level of investment per capita to license duration for 14 countries over a 10-year period. An empirical analysis of the data shows a positive correlation between the tangible investment per capita and the license duration (the average of all active licenses or the latest license). More precisely, we observe an increase of €1.5 in the average investment per capita per year for each additional year of license duration. We also find no significant negative impact of license duration on mobile market competition. The competition outcomes are measured using the Lerner index at the operator level. Some robustness checks are performed at the country level by using the HHI (Herfindahl-Hirschman index) and the number of active mobile operators as measures of the level of competition, and we obtain additional results indicating once more that the competition is not negatively impacted by license duration.     

The long-run impact of Information and Communication Technology on economic output: The case of Australia

This paper investigates the cointegration and causal relationships between Information and Communication Technology (ICT) and economic output in Australia using data for about five decades. The framework used in this paper is the single-sector aggregate production function, which is the first comprehensive approach of this kind to include ICT and non-ICT capital and other factors to examine long-run Granger causality. The empirical evidence points to a cointegration relationship between ICT capital and output, and implies that ICT capital Granger causes economic output and multifactor productivity, as does non-ICT capital.     

The impact of regional ICT development on job quality of the employee in China

The paper matches the province-level ICT development with the micro-level data of the China Family Panel Studies (CFPS), uses multiple indicators to measure ICT development and job quality, and investigates the impact of regional ICT development on job quality of the employee. The research conclusions are as follows: First of all, ICT development has a significant positive impact on job quality of the employee. After a series of robustness tests and dealing with endogeneity issues, the research conclusion continues to be valid. Second, when the job quality of the employee is poor, the promotion of ICT development is relatively strong. Third, ICT development has an indirect impact on job quality through the Internet awareness. Finally, ICT development has a relatively strong role in promoting job quality of women, older, non-agricultural, and medium-skill employees. From the policy perspective, in order to improve the job quality of the employee, we suggest promoting ICT development, narrowing the digital gap, increasing investment in education, and taking into account the different characteristics of employees.     

The system-wide impact of healthy eating: Assessing emissions and economic impacts at the regional level

Encouraging consumers to shift their diets towards a lower meat/lower calorie alternative has been the focus of food and health policies across the world. The economic impacts of such changes on regions have been less widely examined, but are likely to be significant, especially where agricultural and food production activities are important for the region. In this study we use a multi-sectoral modelling framework to examine the environmental and economic impacts of such a dietary change, and illustrate this using a detailed model for Scotland. We find that if household food and drink consumption follows healthy eating guidelines, it would reduce both Scotland’s “footprint” and “territorial” emissions, and yet may be associated with positive economic impacts, generating a “double dividend” for both the environment and the economy. The economic impact however depends critically upon how households use the income previously spent on higher meat/higher calorie diets. Furthermore, the likely (but not modelled) benefits to health suggest the potential for a “triple dividend”.     

Environmental sustainability in the OECD: The power of digitalization,green innovation,renewable energy and financial development

Digitalization has emerged as a crucial factor in reducing pollution and holds significant potential for facilitating the transition to a low-carbon economy. Nevertheless, the environmental impact of digitalization hinges on the strategies for collaboration with various economic actors and, as a result, their engagement with digitalization. In light of this, the present study seeks to examine the externality effect of digitalization on green innovation, renewable energy, and financial development in relation to environmental sustainability. The analysis employs the System Generalized Method of Moments (SYS-GMM) for 36 OECD countries over the period of 2000–2018. The empirical findings indicate that digitalization, green innovation, renewable energy, and financial development substantially promote environmental sustainability. Moreover, the interaction between digitalization, green innovation, renewable energy utilization, and financial development enhances the ecological footprint-mitigating effect of digitalization. In view of these results, merging digitalization and environmental policies may yield more robust outcomes and improved environmental quality compared to implementing a single policy in isolation.