The Impact of Governance Indicators and Policy Variables on Broadband Diffusion in the Developed and Developing Worlds

Abstract

A new digital divide is emerging both within and between nations that is due to inequalities in broadband Internet access. Our research examines the broadband digital divide by analyzing the impact of administrative culture and policy initiatives in the form of strategic planning, execution, regulation and investment on broadband diffusion in 151 countries. Our multiple regression analysis shows that when controlling for measures of economic, political, social and educational development, there is greater broadband diffusion in countries that have an administrative culture of sound governance and make a higher shared financial investment in information and communication technologies. Competition in the telecommunications sector has a positive impact in nations where access to information and communication technologies (ICTs) is expanding, but does not make a significant difference where ICT access is widely available. Most intriguing is that while the presence of a national telecommunications regulatory authority has no impact on broadband diffusion in the technologically developed countries, it has a negative impact on diffusion in technologically developing countries. Our results suggest that factors that determine broadband diffusion in technologically developed countries do not necessarily have the same impact in less developed countries and, therefore, the path to widespread availability and use of broadband requires different strategies depending on a nation’s level of technological development.

Keywords: Broadband Internet, digital divide, public policy, technology affordability, ICT diffusion