Broadband ict investment and public policy
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Broadband, ICT Investment and Public Policy. Robert W. Crandall The Brookings Institution and Criterion Economics KMB Video Journal 41 st Invitational Conference St. Pete Beach, FL May 12-14, 2008. The OECD Estimates of Broadband Penetration Show the U.S. Lagging.

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Broadband, ICT Investment and Public Policy

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Broadband ict investment and public policy

Broadband, ICT Investment and Public Policy

Robert W. Crandall

The Brookings Institution and Criterion Economics

KMB Video Journal

41st Invitational Conference

St. Pete Beach, FL

May 12-14, 2008


The oecd estimates of broadband penetration show the u s lagging

The OECD Estimates of Broadband PenetrationShow the U.S. Lagging


But the oecd measures are very misleading

But the OECD Measures Are Very Misleading

  • Generally ignore wireless broadband

  • Fail to adjust for household size

  • Include business subscribers with residential subscribers for DSL

  • Do not capture other high-speed business services delivered by telcos

  • Result: Countries with highest “broadband penetration” are, in reality, those with greatest business use of mass-market broadband –presumably because high-speed dedicated lines are either too expensive or unavailable


Household penetration statistics year end 2006 provide a very different picture

Household Penetration Statistics Year-End 2006 Provide a Very Different Picture

U.S. Household Penetration: 47% as of October 2006

Source: European Commission, E-Communications Household Survey, 2007; Pew (2007)


A much broader connectivity index has been constructed using 25 indicators

A Much Broader “Connectivity Index” Has Been Constructed Using 25 Indicators

Source: Waverman, Dasgupta & Tonkin, The Connectivity Scorecard, LECG, 2008


The united states has the highest connectivity index among oecd countries

The United States Has the Highest Connectivity Index Among OECD Countries

Summary of The Connectivity Scorecard

  • Country Score

  • United States 6.97

  • Sweden 6.83

  • Japan 6.80

  • Canada 6.50

  • UK 6.10

  • Finland 6.10

  • Australia 5.93

  • Germany 5.52

  • France 5.07 1

  • Korea 4.78

  • Hong Kong 4.46

  • Italy 3.85

  • Spain 3.56

  • Hungary 3.18

  • Czech 3.11

  • Poland 2.18

Source: Waverman, Dasgupta & Tonkin, The Connectivity Scorecard, 2008


U s telcos have been investing far more than eu telcos

U.S. Telcos Have Been Investing Far More than EU Telcos


And productivity growth has been much greater in the u s than in the eu

And Productivity Growth Has Been Much Greater in the U.S. than in the EU

Source: Groningen Growth & Development Center


Dale jorgenson and colleagues have estimated sources of u s productivity growth

Dale Jorgenson and Colleagues Have Estimated Sources of U.S. Productivity Growth


Information technology drives u s productivity growth but software has dominated other it products

Information Technology Drives U.S. Productivity Growth, but Software Has Dominated Other IT Products

Source; Dale Jorgenson, PFF Presentation, 2007


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