Abstract

http://ssrn.com/abstract=1810555
 


 



Productivity Questions for Public Sector Fast Fibre Network Financiers


Bronwyn E. Howell


Victoria University of Wellington - NZ Institute for the Study of Competition and Regulation Inc. and Victoria Management School

Arthur Grimes


Motu Economic and Public Policy Research Trust

June 15, 2010

Communications and Strategies, No. 78, No. 2, pp. 127-145, 2010

Abstract:     
Fast internet access is widely considered to be a productivity-enhancing factor. However, despite promises of substantial gains from its deployment, the evidence from recent empirical studies suggests that the productivity gains may not be as large as originally hypothesised. If substantiated, these findings suggest that current government plans to apply significant sums to bring forward the deployment of fast fibre networks (e.g. in both Australia and New Zealand) may not generate returns to the extent anticipated by their sponsors. Drawing upon the original 'computer productivity paradox' literature, this paper develops a critical questioning framework to assist policy-makers in identifying the salient productivity issues to be addressed when making the decision to apply scarce public resources to faster broadband network deployment. Using multiple literatures, the framework highlights the nuanced and highly complex ways in which broadband network speed may affect productivity, both positively and negatively. Policy-makers need to be satisfied that, on balance, government-funded investments in faster networks will likely generate the anticipated net benefits, given the significant uncertainties that are identified.

Number of Pages in PDF File: 19

Keywords: Internet, broadband, productivity, public investment

JEL Classification: H49, O33

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Date posted: April 19, 2011 ; Last revised: May 5, 2011

Suggested Citation

Howell, Bronwyn E. and Grimes, Arthur, Productivity Questions for Public Sector Fast Fibre Network Financiers (June 15, 2010). Communications and Strategies, No. 78, No. 2, pp. 127-145, 2010. Available at SSRN: http://ssrn.com/abstract=1810555

Contact Information

Bronwyn E. Howell (Contact Author)
Victoria University of Wellington - NZ Institute for the Study of Competition and Regulation Inc. and Victoria Management School ( email )
Wellington 6001
New Zealand
+64 4 463 5563 (Phone)
+64 4 463 5566 (Fax)
Arthur Grimes
Motu Economic and Public Policy Research Trust ( email )
19 Milne Terrace
Island Bay
Wellington 6002
New Zealand
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