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Infrastructure Investment and Rural Economic Development: An Evaluation of USDA's Broadband Loan Program
Author(s) -
KANDILOV IVAN T.,
RENKOW MITCH
Publication year - 2010
Publication title -
growth and change
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.657
H-Index - 55
eISSN - 1468-2257
pISSN - 0017-4815
DOI - 10.1111/j.1468-2257.2010.00524.x
Subject(s) - loan , payroll , propensity score matching , broadband , investment (military) , business , finance , matching (statistics) , economic impact analysis , subsidy , economic growth , economics , accounting , telecommunications , engineering , statistics , mathematics , politics , political science , law , microeconomics , market economy
We empirically evaluate whether participation in the U.S. Department of Agriculture's Broadband Loan Program, which began making loans in 2002, has had measurable positive impacts on zip code‐level economic outcomes. Using difference in differences and propensity score matching program evaluation techniques, we find that loans made in 2002 and 2003 under the Pilot Broadband Loan Program have had a substantial positive impact on employment, annual payroll, and the number of business establishments in recipient communities. However, a more spatially disaggregated analysis reveals that the positive economic impacts of the pilot program are driven primarily by the outcomes in communities located closest to urban areas. Finally, we find no evidence that loans received as part of the current Broadband Loan Program have had a measurable positive impact on recipient communities, possibly because not enough time has elapsed for the impacts of the current Broadband Loan Program to have emerged.