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The Digital Divide and Other Economic Considerations for Network Neutrality

Michelle Connolly (), Clement Lee and Renhao Tan
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Michelle Connolly: Duke University
Clement Lee: Duke University
Renhao Tan: Duke University

Review of Industrial Organization, 2017, vol. 50, issue 4, 537-554

Abstract: Abstract In its 2016 Broadband Report, the Federal Communications Commission (FCC) recognizes that a rural/urban digital divide remains prevalent—especially with respect to broadband adoption. It also highlights several policies that the FCC has undertaken purportedly to reduce the divide, including the 2015 Open Internet Order (OIO)—in which the stated intent is to enforce “network neutrality.” However, long before the OIO, studies have raised concerns that network neutrality policies will discourage investment by internet service providers (ISPs) in broadband infrastructure, to the detriment of broadband accessibility, and may increase average consumer costs—both of which would only further exacerbate the digital divide. In this paper, we provide a holistic analysis of the effects of net neutrality on the digital divide; in doing so, we draw from recent economic research on this issue. Our goal is to present a range of economic considerations that should be taken into account when evaluating the overall impact of the OIO, with particular attention to its impact on the digital divide.

Keywords: Net neutrality; Internet service providers; Content service providers; Digital divide; Telecommunications; Regulation; Open Internet Order; Welfare; FCC; Broadband (search for similar items in EconPapers)
JEL-codes: L96 L98 L51 K23 (search for similar items in EconPapers)
Date: 2017
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Handle: RePEc:kap:revind:v:50:y:2017:i:4:d:10.1007_s11151-016-9554-8