High-speed Internet access and housing values

Gabor Molnar, Scott Savage () and Douglas C. Sicker

Applied Economics, 2019, vol. 51, issue 55, 5923-5936

Abstract: A hedonic model is estimated that relates house values to high-speed Internet access while controlling for the potential endogeneity of Internet access. Results show that single-family homes with access to a 25 Mbps broadband connection have a price that is about $5,977, or 3%, more than similar homes in neighborhoods with 1 Mbps. The rural premium is lower at $5,099. A cost-benefit exercise on the viability of rural broadband shows that demand will generally not support private investment, but that the revenue gap from upgrading legacy networks could be readily covered by the Universal Service Fund and other public subsidies.

Date: 2019
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DOI: 10.1080/00036846.2019.1631443

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