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Broadband connectivity is regarded as generally having a positivemacroeconomic effect, but we lack evidence as to how it affects key economicactivity metrics, such as firm creation, at a very local level. This analysismodels the impact of broadband Next Generation Access (NGA) on new businesscreation at the local level over the 2011-2015 period in England, UnitedKingdom, using high-resolution panel data. After controlling for a range offactors, we find that faster broadband speeds brought by NGA technologies havea positive effect on the rate of business growth. We find that in Englandbetween 2011-2015, on average a one percentage increase in download speeds isassociated with a 0.0574 percentage point increase in the annual growth rate ofbusiness establishments. The primary hypothesised mechanism behind theestimated relationship is the enabling effect that faster broadband speeds haveon innovative business models based on new digital technologies and services.Entrepreneurs either sought appropriate locations that offer high qualitybroadband infrastructure (contributing to new business establishment growth),or potentially enjoyed a competitive advantage (resulting in a higher survivalrate). The findings of this study suggest that aspiring to reach universal highcapacity broadband connectivity is economically desirable, especially as thecosts of delivering such service decline.

Crowdsourced data indicates broadband has a positive impact on local business creation