Author
AbstractAs part of the Federal Communications Commission (“FCC”) National Broadband Report to Congress, we have been asked to conduct a survey to help determine consumer valuations of different aspects of broadband Internet service. Our empirical results show that reliability and speed are important characteristics of Internet service. The representative household is willing to pay about $20 per month for more reliable service and $45-48 for an increase in speed. Willingness-to-pay for speed increases with education, income and online experience, and decreases with age. Rural households value connection speed by about $3 more per month than urban households. Households are also willing to pay an additional $4 for the ability to interact with health specialists online, about $3 for the ability to download full-length movies, and about $5 for the ability to place free phone calls over the Internet and see the person being called. Using these results, we calculate that a representative household would be willing to pay about $59 per month for a less reliable Internet service with fast speed, about $85 for a reliable Internet service with fast speed and the priority feature, and about $98 for a reliable Internet service with fast speed plus all other activities.
Suggested Citation
Gregory Rosston & Scott Savage & Donald Waldman, 2010.
"Household Demand for Broadband Internet Service,"
Discussion Papers
09-008, Stanford Institute for Economic Policy Research, revised Feb 2010.
Handle:
RePEc:sip:dpaper:09-008
Download full text from publisher
Most related items
These are the items that most often cite the same works as this one and are cited by the same works as this one.
- Savage, Scott James & Waldman, Donald M., 2009.
"Ability, location and household demand for Internet bandwidth,"
International Journal of Industrial Organization, Elsevier, vol. 27(2), pages 166-174, March.
- Hans-Peter Blossfeld & Alfred Hamerle, 1989.
"Unobserved heterogeneity in hazard rate models: a test and an illustration from a study of career mobility,"
Quality & Quantity: International Journal of Methodology, Springer, vol. 23(2), pages 129-141, June.
- Trond Petersen, 1986.
"Estimating Fully Parametric Hazard Rate Models with Time-Dependent Covariates,"
Sociological Methods & Research, , vol. 14(3), pages 219-246, February.
- Lazo, Jeffrey K. & Waldman, Donald M., 2011.
"Valuing improved hurricane forecasts,"
Economics Letters, Elsevier, vol. 111(1), pages 43-46, April.
- Stephen Pudney, 1988.
"Estimating engel curves : a generalisation of the P-Tobit model,"
Finnish Economic Papers, Finnish Economic Association, vol. 1(2), pages 129-147, Autumn.
- Scott J. Savage & Donald M. Waldman, 2008.
"Learning and fatigue during choice experiments: a comparison of online and mail survey modes,"
Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 23(3), pages 351-371.
More about this item
Keywords
broadband;
choice experiment;
experience;
internet;
willingness-to-pay;
All these keywords.
JEL classification:
- C24 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Truncated and Censored Models; Switching Regression Models; Threshold Regression Models
- C25 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Discrete Regression and Qualitative Choice Models; Discrete Regressors; Proportions; Probabilities
- D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
- O38 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Government Policy
Statistics
Access and download statistics
Corrections
All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:sip:dpaper:09-008. See general information about how to correct material in RePEc.
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Anne Shor (email available below). General contact details of provider: https://edirc.repec.org/data/cestaus.html .
Please note that corrections may take a couple of weeks to filter through
the various RePEc services.