Broadband Communities

NOV-DEC 2017

BROADBAND COMMUNITIES is the leading source of information on digital and broadband technologies for buildings and communities. Our editorial aims to accelerate the deployment of Fiber-To-The-Home and Fiber-To-The-Premises.

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70 | BROADBAND COMMUNITIES | | NOVEMBER/DECEMBER 2017 ECONOMIC DEVELOPMENT Measuring Broadband and Job Loss: Population or Income? New research by Broad B and Communities finds a clear relationship between broadband access and median family income but no clear causality. By Steven S. Ross / Broadband Communities S ince 2014, I have been studying the effects of poor or nonexistent broadband access on population loss in all 3,144 U.S. counties. is research was motivated by the fact that since 2010, rural population levels have been falling for the first time since the Civil War. In a series of articles in Broad B and Communities , I have shown that at least a quarter and as much as half of all population loss in rural counties has been due to lack of broadband access. • "Bad Broadband Equals Low Population Growth," November-December 2014, reported a clear relationship between population loss from 2010 to 2013 and the percentage of each county's population that has access to at least 25 Mbps service, as indicated by the National Broadband Map. But correlation is not causality. Did the population loss come first, discouraging broadband deployments, or did the lack of broadband cause the population loss? • "New Evidence on Muni Broadband," May-June 2015, showed that lack of broadband access caused population loss in a quarter to half of the counties. We distinguished between the 20 states that restricted municipalities from building their own networks and the 30 states that did not. e restriction states suffered four times the rural population loss rate of the nonrestriction states even though their overall population growth rates were higher. e restriction states also strongly tended to have a much larger digital divide between have and have-not counties. By threatening to build their own networks, municipalities could force national carriers to provide at least some improved service. ose in states that did not allow these threats were at a severe disadvantage. • "Broadband: e Key Ingredient for Rural Economic Development," November-December 2016, disaggregated counties by dominant economic activity as determined by the Department of Agriculture (farming, retirement, mining, manufacturing and so forth) and showed that the original correlations held up extremely well whether the counties were rural or near-urban. e one exception was for mining counties, whose population trends depended more on world commodity prices than on broadband availability. In all cases, I used population rather than income as the proxy for economic health. No job? Move to the city! ose who use population as a key variable note that it is measured more accurately than income and that its error limits (confidence intervals) are well known and are considerably smaller and more predictable than those for income. In addition, people who live in rural areas tend to cite population loss as an indicator of economic distress. ey say, "Our kids go off to college, and they don't come back." But what would happen if I used income – specifically median family income as measured by the Census Bureau's American Community Survey (ACS)? In the raw ACS data, error limits for median family income are often as much as 10 times (on a percentage basis) greater than those for population – and sometimes much more. In part this is because • e ACS studies most urban areas every three months, but it surveys rural areas as seldom as once every three years. • ACS estimates "hidden" income on the basis of bank deposits, but people don't always deposit money in the counties where they live. Much income from the "casual" off-the-books economy never even reaches a bank. • Income measured by ACS includes benefits – everything from the earned-income tax credit and SNAP benefits to disability payments. Residents do not have full discretion

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