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Ultra-broadband investment and economic resilience: Evidence from the Covid-19 pandemic

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  • Abrardi, Laura
  • Sabatino, Lorien

Abstract

We study the role of ultra-broadband infrastructures in reducing the economic recession caused by the 2020 pandemic. We exploit the variation in GDP and employment that happened between 2019 and 2020 as a result of the Covid-19 pandemic outbreak, and we investigate whether UBB investments had an impact on economic resilience. We use micro-level data on UBB exposure in 2019 matched with municipality-level information on local GDP and employment levels based on tax declarations for the period 2019–2020. We address the endogeneity between UBB and local income by exploiting the distance from the closest backbone node of the upstream telecommunication network. We find that exposure to UBB mitigates the negative effect of the pandemic on local employment. One additional year of UBB exposure increases local employment by 1.3 percentage points. The effect is stronger in areas hit more severely by the pandemic, thus confirming the role of advanced broadband infrastructures on the economic resilience from negative shocks.

Suggested Citation

  • Abrardi, Laura & Sabatino, Lorien, 2023. "Ultra-broadband investment and economic resilience: Evidence from the Covid-19 pandemic," Telecommunications Policy, Elsevier, vol. 47(2).
    • Handle: RePEc:eee:telpol:v:47:y:2023:i:2:s0308596122001823
    DOI: 10.1016/j.telpol.2022.102480
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    References listed on IDEAS

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    More about this item

    Keywords

    Ultra-broadband (UBB); Fiber-based networks; Resilience; Covid-19;
    All these keywords.

    JEL classification:

    • L96 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Telecommunications
    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • D22 - Microeconomics - - Production and Organizations - - - Firm Behavior: Empirical Analysis

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