Evaluating the Impact of the American Recovery and Reinvestment Act's BTOP Program on Broadband Adoption

Abstract

The American Recovery and Reinvestment Act’s Broadband Technology Opportunities Program (BTOP) spent $4.7B during 2009-2013 to, int. al, increase broadband adoption in underserved communities. We characterize the BTOP grants and examine the impact of the awards on broadband adoption. Econometric specifications controlling for award endogeneity related to observed and unobserved county-level factors find that spending is apparently associated with increased broadband adoption. Further investigation, however, reveals that the impacts of spending are nonlinear and even nonmonotonic over the range of county-level BTOP spending in the data. Controlling for trends to reduce the potential for spurious correlation between spending and outcomes removes most of the significance of the results. We conclude with three lessons for policymakers derived from the uncertain outcomes of BTOP spending found in our exploration.

Keywords: ARRA; BTOP; broadband adoption; FCC; NTIA; fixed effects ordered logit; blow up and cluster method; restricted cubic splines

JEL Classification: H54, O33, L96, H42