Professor Carlo Cambini will be presenting his recent paper:
"The Impact of ultra fast broadband networks on firms and economic outcomes"
Abstract: The Seminar focuses on recent evidences on the impact of ultra-fast broadband (UFB) investments on firms’ performance and other economic outcomes. In particular, the first part of the presentation will be based on Cambini et al. (2022) and Cambini and Sabatino (2023)’s papers. In those analyses, using an original dataset at municipal level on the diffusion of UFB in Italy, we present recent evidences on the effects of UFB investment on firm productivity and firm turnover. Regarding firm productivity, we use unique balanced panel data for the 2013–2019 period on incorporated firms in Italy. Using the geographical location of the firms, we merge firm-level data with municipality-level information on the diffusion of UFB, which started in 2015. We derive consistent firm-level TFP estimates by adopting a version of the Ackerberg et al.’s (2015) method, which also accounts for firm fixed effects. Regarding firm turnover, we then provide a first empirical evidence of the impact of ultra‐broadband (UBB) internet connections on the dynamics of firm entry and exit. In both the analysis, we deal with the endogeneity of UFB by exploiting the physical distance between each municipality and the closest optical backbone node.
We then further expand our analysis to present preliminary evidences on the impact of broadband (both basic and ultra-fast) on firm innovation, by exploiting a unique dataset on broadband diffusion since 2005 with firms’ patenting efforts (Cambini et al., 2023). The goal is to understand whether UFB positively affects innovation beyond a simple reduction in coordination/communication costs (e.g., does it also foster patents by single/geographically-close inventors) and to verify whether internet coverage (extensive margin) is more or less relevant than internet speed (intensive margin) in fostering innovation. We will conclude the seminar with preliminary evidence on the impact of UFB on the labour market showing some results from a project using micro-data at employee level (Abrardi et al., 2023).
References
Abrardi L., Cambini C., Grinza E, Sabatino L. (2023), “Advanced digital technologies and labor market outcomes”, mimeo.
Cambini C., Grinza E. and Sabatino L. (2022), “Ultra-fast broadband access and productivity: Evidence from Italian firms”, International Journal of Industrial Organization, 86.
Cambini C. and Sabatino L. (2023), “Digital highways and firm turnover”, Journal of Economics and Management Strategy, 1, 1-41.
Cambini C., Murro P., Sabatino L., Schivardi F., Sobbrio F., (2023), Broadband and Innovation, mimeo.
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