A retrospective study on the regional benefits and spillover effects of high-speed broadband networks: Evidence from German counties

Wolfgang Briglauer, Niklas Dürr and Klaus Gugler
Authors registered in the RePEc Author Service: Niklas Stephan Duerr

International Journal of Industrial Organization, 2021, vol. 74, issue C

Abstract: This study aims to assess the economic benefits of high-speed broadband within and across neighboring counties in Germany. Utilizing a balanced panel dataset of 401 German counties with data from 2010 to 2015 as well as different panel estimation techniques, we find that an increase in average broadband speed has a significantly positive effect on regional GDP in the average German county. Furthermore, we find that broadband deployment in German counties induces not only substantial economic benefits in terms of direct effects within counties but also positive regional externalities across counties. According to our estimation results, an increase in average bandwidth speed by one unit (1 Mbit/s) induces a rise in regional GDP of 0.18%. This effect is almost doubled if we also take regional externalities into account (0.31%). Moreover, we find that regional agglomeraton effects are of particular relevance for rural counties. Our cost-benefit analysis of subsidies based on conservative estimates suggests efficiency gains, as the total economic per capita benefits (€164) of subsidy programs to encourage broadband expansion exceeded their associated per capita costs (€114).

Keywords: High-speed broadband infrastructure; Economic growth; Spatial externalities; German counties; Panel data (search for similar items in EconPapers)
JEL-codes: H23 H54 L96 L98 R11 R58 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (12)

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Related works:
Working Paper: A Retrospective Study on the Regional Benefits and Spillover Effects of High-Speed Broadband Networks: Evidence from German Counties (2019)
Working Paper: A retrospective study on the regional benefits and spillover effects of high-speed broadband networks: Evidence from German counties (2019)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:indorg:v:74:y:2021:i:c:s0167718720301004

DOI: 10.1016/j.ijindorg.2020.102677

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