Understanding the Impact of Policy, Regulation and Governance on Mobile Broadband Diffusion in the Developing World
Posted: 31 Mar 2013
Date Written: March 30, 2013
The 2012 edition of the World Bank’s Information and Communications for Development report urges countries to increase mobile broadband diffusion in order to improve the state of agriculture, health, financial services, employment and government in the developing world (World Bank, 2012). The main goal of our research is to identify public policy alternatives, regulatory measures, and governing practices that increase the adoption of mobile broadband in developing countries, which have largely adopted a "mobile first" strategy for on-line services. In achieving this goal, we show that different models are necessary to understand mobile broadband diffusion in the developed and developing worlds.
Past cross-national research that examined broadband diffusion has been limited mainly to OECD countries (e.g., Lee, Marcu & Lee, 2011). Yet, findings from these studies have been generalized to apply to developed and developing nations alike. This study examines the impact of policy, regulation and governance on mobile broadband diffusion in 131 countries. In the OECD countries, there is greater diffusion of mobile broadband in countries that make a higher financial investment in information and communication technologies (ICTs) and that practice more effective governance. The degree of competitiveness of the telecommunications sector and more specific measures of governance (i.e., the Telecommunications Regulatory Governance Index proposed by Waverman & Koutroumpis (2011)) do not affect mobile broadband diffusion. In developing countries, national wealth matters a great deal, but greater competition in the telecommunications sector, higher financial investment in ICTs, and telecommunications regulatory governance also significantly increase mobile broadband diffusion.
This research also extends previous findings that connect bridging information and communication divides with political structure (Norris, 2001) and institutional governance (Levy & Spiller, 1996). While we confirm that these factors do not affect mobile diffusion in developed countries, they are important factors in developing countries. The broader regulatory environment and how government is practiced (i.e., governance) are important variables, however, for understanding outcomes such as widespread access to new ICTs in developed countries.
In sum, we found that public policy initiatives, democratic institutions and effective regulatory governance matter, and can mitigate, to some extent, the advantages enjoyed by most developed countries. While we present strong evidence that national policy, regulation and governance are all important, we also show that resources in terms of wealth (in developing countries) and education (in developed countries) matter more for leveraging the benefits of mobile technologies for digital inclusion. Thus, we also show the limits that policy initiatives and related factors have in bridging the mobile broadband divide, at least in the short-term. Finally, it is important for policymakers to be aware and to understand that the path to widespread adoption of mobile broadband requires different strategies depending on a nation’s level of economic, political and institutional development.
Note: This empirical research is based on multiple regression analysis of several models that combine and separate OECD and non-OECD countries. The variables associated with each country are derived from publically available data reported by the United Nations, World Bank, ITU, OECD, CIA World Fact Book, and also Waverman & Koutroumpis (2011, Telecommunications Policy) and Pemstein, Meserve & Melton (2010, Political Analysis). Some of these variables are used as-is whereas others are aggregated into indeces that we have developed, for example, to measure telecommunications competition and financial investment in ICTs. This is original research that has not been presented at or published in an alternative outlet.
Keywords: competition, digital divide, financial investment, governance, IC4D, institutions, mobile broadband, regulation, technology diffusion, telecommunications policy, wireless broadband
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