Different Paths to Universal Access: The Impact of Policy and Regulation on Broadband Diffusion in the Developed and Developing Worlds

Abstract

We examine the broadband digital divide by analyzing the impact of policy and regulation on broadband Internet diffusion. Our multiple regression analysis shows that factors that determine broadband diffusion in technologically developed countries do not necessarily have the same impact in less developed countries. We show that in technological developed countries, there is greater broadband diffusion in countries that make a higher financial investment in information and communication technologies and have effective governing practices at the national level. In technologically developing nations, however, a competitive telecommunications sector also lead to greater broadband diffusion and higher investment in ICTs has even a larger impact than in the developed world, but the presence of a national telecommunications regulatory authority has a negative impact. In addition, stronger democratic political institutions increases diffusion in the developed world, but more effective governance has no effect. These results suggest that the path to widespread availability and use of broadband requires different strategies depending on a nation’s level of technological development.

Keywords: Broadband digital divide, diffusion of innovations, global information society, telecommunications competition, telecommunications regulation, telecommunications investment