Higher rural broadband adoption rates are directly linked with economic health, according to new research released yesterday.
“Broadband adoption does have an impact on household income and employment,” said Sharon Strover of the University of Texas, on a webcast yesterday to present the findings. Strover is one of three people – including Brian Whitacre of Oklahoma State University and Roberto Gallardo of Mississippi State University – who conducted the research.
The researchers measured economic health based on seven factors – including median household income, the percentage of people in poverty, the total people employed, non-farm proprietor income, the number of firms with paid employees, the percentage of non-farm proprietors and the percentage of employees classified as “creative class.”
The research looked at the impact of broadband availability, download speeds, adoption rates and the number of broadband providers on on the seven economic factors using three different modeling techniques.
“If there were a lot of people without broadband available or not a lot of providers, it negatively impacts all seven economic measures,” said Whitacre.
Depending on the modeling technique used, high broadband adoption rates (above 60%) positively impacted the total number of jobs and firms, median household income, poverty rates and unemployment rates, the researchers found.
Interestingly, at least two of the modeling techniques showed that broadband adoption had a greater positive impact than broadband availability.
While noting that “you can’t have adoption without availability,” Strover said the results suggest that policymakers “need to attend to the demand side.”
In a policy brief published by the National Agricultural & Rural Development Policy Center, the researchers said their findings “constitute an important indication that development efforts focused on mobilizing populations to subscribe to and use broadband capabilities will reap gains.”
A couple of other findings from the new research:
- In 2003, about 11% of rural households and 24% of metro households had adopted broadband – a gap of 13 percentage points. By 2010, about 57% of rural households and 70% of metro households had adopted broadband – an identical gap of 13 points.
- When asked their primary reason for not using broadband 40% of rural residents in 2003 said they didn’t need it. By 2010 that number had climbed to 47%.