Fast and furious: the productivity effects of the geography of experienced internet speeds

Abstract

The link between digital technologies and productivity has long intrigued researchers. Key to unpacking this relationship is detailed data connecting internet usage, economic outputs, and places. Using a multilevel modelling framework, we combine firm-level microdata with unique internet speed microdata that reflect end-user experiences, distinguishing upload and download speeds. This approach approximates business internet usage and reveals that higher speeds boost productivity, while unstable speeds have the opposite effect. These findings highlight the economic importance of high-speed internet infrastructure and present policymakers with a trade-off between efficiency and equity in planning decisions.