Broadband and development: evidence and new research directions from Latin America (TPRC presentation)


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Presentación elaborada por el Dr. Hernán Galperín para la conferencia TPRC, realizada el 27 de septiembre de 2013 en Washington DC.

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  • NotonlytheoreticalinterestSomeinitiatives are little more thandeclarations, othersinvolvesignificantspendingIn othercountriestheseinvestments are undertakenbythepublictelecomsoperator (e.g., Ecuador, Uruguay and Venezuela)X% of social spending
  • Twotypes of initiatives: connectivity and equipmentMany other initiatives at the state or municipal level
  • Two additional elements: threshold effect (only after 10%) and nonlinear effect (grows with penetration)
  • Mayo and Wallsten replicate Crandall for recent period and find no effect.Forman find effect limited to wealthier 6%
  • Broadband and development: evidence and new research directions from Latin America (TPRC presentation)

    1. 1. > BROADBAND AND DEVELOPMENT: EVIDENCE AND NEW RESEARCH DIRECTIONS FROM LATIN AMERICA HERNAN GALPERIN, PH.D. Associate Professor, Universidad de San Andrés Diálogo Regional sobre la Sociedad de la Información (DIRSI) September 26, 2013 Telecommunications Policy Research Conference, September 27, 2013
    2. 2. > PUBLIC INVESTMENT ON BROADBAND INITIATIVES IS ON THE RISE IN LATAM, SOME ARE VERY SIGNIFICANT (UP TO 0.78% OF GDP) 0 5 10 15 20 25 2006 2007 2008 2009 2010 2011 2012 Countries with National Broadband Plan (2012) ARGENTINA BRAZIL COLOMBIA NAME OF INITIATIVE Argentina Conectada Plano Nacional de Banda Larga (PNBL) Vive Digital GEOGRAPHICAL TARGET 100% municipalities 76% municipalities 62% municipalities PRICE/QUALITY TARGET 10Mbps 1Mbps at US$ 20 per month 1Mbps TOTAL INVESTMENT $1.8 billion USD $3.25 billion USD $2.25 billion USD TOTAL PER CAPITA $44.2 USD $16.6 USD $48.6 USD TOTAL AS % GDP 0.4% 0.13% 0.78% DURATION 2011-2015 2010-2014 2010-2014 > Source: ITU/CISCO (2013)
    3. 3. > INVESTMENTS IN ICT FOR EDUCATION PROGRAMS ARE EQUALLY SIGNIFICANT (UP TO 10% OF TOTAL EDUCATION EXPENDITURE) > Source: UNESCO ARGENTINA BRAZIL URUGUAY NAME OF INITIATIVE Conectar Igualdad Programa Banda Larga nas Escolas Plan Ceibal TARGET Secondary Primary and secondary Primary and secondary CONNECTIVITY No Yes Yes EQUIPMENT Yes (laptop) No Yes (OLPC) TOTAL ANNUAL INVESTMENT ~700M USD n/a ~50M USD TOTAL AS % EDUCATION EXPENDITURE 10% n/a 5% YEAR STARTED 2010 2010 2008 0 5 10 15 20 25 30 35 40 45 50 Primary Secondary Countries with ICT in Education programs
    4. 4. Does the evidence about positive impacts support these public investments? How are benefits being appropriated? How large are impact externalities? What is the distributional impact? How cost-effective are these programs? How to improve program design and implementation? > > > > PROJECT MOTIVATION: RECENT PUBLIC INVESTMENTS IN BROADBAND RAISE QUESTIONS ABOUT DEVELOPMENT IMPACT
    5. 5. > THE OPTIMISTIC PERSPECTIVE: BROADBAND AVAILABILITY AND ADOPTION BOOST EMPLOYMENT AND ACCELERATE GDP GROWTH AUTHOR(S) DATA METHODOLOGY RESULTS QIANG AND ROSSOTTO (2009) 120 countries, 1980-2006. OLS 10 p.p. increase in broadband yields an additional 1.38 p.p. of GDP growth. KOUTROUMPIS (2009) 22 OECD countries, 2002–2007. Simultaneous equations model and instrumental variables. A 10% increase in broadband increases GDP growth by an average of 0.25% CZERNICH ET AL. (2011). 25 OECD countries, 1996-2007. Instrumental variables. A 10 p.p. increase in broadband raises annual per-capita growth by 0.9-1.5 p.p. LEHR ET AL. (2006). ZIP codes and states (US), 1998–2002. OLS Broadband availability increases employment by 1.5% and businesses by 0.5%. No effect on wages. CRANDALL, R. ET AL. (2007). States (USA), 2003-2005. OLS A 10% increase in the penetration rate increases employment by 2%. No effect on GDP growth.
    6. 6. > SOME CAVEATS ABOUT THE (OVERLY) OPTIMISTIC PERSPECTIVE Causal attribution is problematic  reverse causality needs to be addressed in study design. Aggregated data at country or state level  small samples, difficult to find appropriate controls. Little conceptualization about underlying mechanisms through which broadband affects development  opening the black box. > > > Some recent studies are less optimistic (e.g., Mayo and Wallsten, 2011; Forman et al., 2012). >
    7. 7. > PROJECT OVERVIEW Six quasi-experimental studies based on existing microdata. > Counterfactuals in order to address reverse causality problem. > Very large samples: ability to test for heterogeneous impacts, external validity (unlike RCT). Qualitative study in low-income communities in Mexico to validate results and get in-depth perspective on impact mechanisms. Extensive lit review about microfoundations of the link between broadband and development > Focus on poverty alleviation >1 >2 >3
    8. 8. > THREE CASE STUDIES LOOKING AT BROADBAND IMPACT ON GROWTH AND EMPLOYMENT CASE STUDY COUNTRY DATA SOURCES METHODOLOGY INTERNET AND ECONOMIC ACTIVITY IN COLOMBIA : AN ANALYSIS AT THE LEVEL OF MUNICIPALITIES AND 23 MAJOR CITIES. Colombia Panel of municipalities (2005- 2011). Number of observations: 5,000 municipalities. Annual household survey from DANE and deployment information from by Ministry of ICT. Panel data with random effects and instrumental variable. IMPACT OF BROADBAND DEPLOYMENT IN ECUADOR. Ecuador Panel of individuals in urban areas 2009-2011. Number of observations: 24,000 individuals. National Household Survey and deployment data from Ministry. Difference-in-difference. THE WELFARE IMPACT OF BROADBAND IN MEXICO. Mexico Number of observations: 7,000. National household survey from INEGI. Structural equation models.
    9. 9. > THREE CASE STUDIES LOOKING AT BROADBAND IMPACT ON SCHOOL PERFORMANCE CASE STUDY COUNTRY DATA SOURCES METHODOLOGY CONNECTED TO LEARN? THE EFFECT OF BROADBAND INTERNET ON SCHOOL QUALITY IN BRAZIL. Brazil Panel data of students and teachers 2007-2011. Number of observations: between 83,000 and 124,000. School census and test scores (Prova Brasil) from Ministry of Education. Administrative data for PBLE from ANATEL. Regression models that exploit the phase-in of the program. CAN INFORMATION AND COMMUNICATION TECHNOLOGIES (ICTS) HAVE A POSITIVE IMPACT ON STUDENT PERFORMANCE? EVIDENCE FROM CHILE. Chile Two cohorts of primary-level students in public schools (2005-2011). Number of observations: between 110,000 and 133,000. Test scores (SIMCE) and information about ENLACES program from Ministry of Education. Difference-in-difference with matching. INTERNET ACCESS, TYPE OF ACCESS AND EDUCATIONAL OUTCOMES: EVIDENCE FOR THE PERUVIAN CASE. Peru Panel data of students at school level (2007-2011). Number of observations: 10,000. School Census and test scores data from Ministry of Education. Difference-in-difference with matching.
    10. 10. More information: