nep-ict New Economics Papers
on Information and Communication Technologies
Issue of 2016‒10‒23
five papers chosen by
Walter Frisch
Universität Wien

  1. The Tragedy of the Last Mile: Congestion Externalities in Broadband Networks By Jacob Malone; Aviv Nevo; Jonathan Williams
  2. Ideological Segregation among Online Collaborators: Evidence from Wikipedians By Shane Greenstein; Yuan Gu; Feng Zhu
  3. Information Technology and Global Sourcing By Fromenteau, Phillipe
  4. Nanothechnology and the emergence of a general purpose technology By Stuart Graham; Maurizio Iacopetta
  5. Hedonic Prices for Fixed Broadband Services: Estimation across OECD Countries By Carol Corrado; Olga Ukhaneva

  1. By: Jacob Malone (University of Georgia, Department of Economics); Aviv Nevo (University of Pennsylvania, Department of Economics); Jonathan Williams (University of North Carolina - Chapel Hill, Department of Economics)
    Abstract: We exibly estimate demand for residential broadband accounting for congestion externalities that arise among consumers due to limited network capacity, as well as dynamics arising from nonlinear pricing. Our high frequency data permits insight into temporal patterns in usage across the day that are impacted by network congestion, and how usage responds to efforts to mitigate congestion. To estimate demand, we build a dynamic model of consumer choice and rely on variation in the timing of network upgrades and nonlinear pricing to identify the model. Using the model estimates, we calculate the welfare changes associated with different economic and technological solutions for reducing congestion, including peak-use pricing, throttling connectivity speeds, and local-cache technologies.
    Keywords: demand; broadband; congestion; peak-use pricing
    JEL: L11 L13 L96
    Date: 2016–09
  2. By: Shane Greenstein; Yuan Gu; Feng Zhu
    Abstract: Do online communities segregate into separate conversations when contributing to contestable knowledge involving controversial, subjective, and unverifiable topics? We analyze the contributors of biased and slanted content in Wikipedia articles about U.S. politics, and focus on two research questions: (1) Do contributors display tendencies to contribute to sites with similar or opposing biases and slants? (2) Do contributors learn from experience with extreme or neutral content, and does that experience change the slant and bias of their contributions over time? The findings show enormous heterogeneity in contributors and their contributions, and, importantly, an overall trend towards less segregated conversations. A higher percentage of contributors have a tendency to edit articles with the opposite slant than articles with similar slant. We also observe the slant of contributions becoming more neutral over time, not more extreme, and, remarkably, the largest such declines are found with contributors who interact with articles that have greater biases. We also find some significant differences between Republicans and Democrats.
    JEL: L17 L3 L86
    Date: 2016–10
  3. By: Fromenteau, Phillipe
    Abstract: This paper examines how IT influences global sourcing decisions. It develops a theoretical model to study how IT determines the decisions of firms located in the high-wage North whether to offshore production to a low-wage country in the South. Offshoring to South however is subject to costly communication reflected by partially incomplete contracting. More sophisticated IT allows more efficient communication between the Northern headquarter and its Southern intermediate input supplier and alleviates contractual frictions. The model provides several predictions about the impact of IT on the organization of the global supply chain. Complex industries for which codifiability and verifiability of information is a much harder task, are more likely to source intermediate inputs in countries with more efficient IT infrastructure. Considering the mode of firm organization, more efficient IT infrastructure is expected to reduce the share of intra-firm trade in more complex industries. These predictions are examined and validated using disaggregated industry-level trade data. Most importantly, these findings are robust to controlling for well-known sources of comparative advantage and determinants of firm organization such as factor endowments, financial development and contract enforcement.
    Keywords: Information Technology; Global Sourcing; Multinational Firm; Firm Organization; Tasks
    JEL: D23 F14 F23 L23 O33
    Date: 2016–07
  4. By: Stuart Graham (Georgia Institute of technology); Maurizio Iacopetta (Observatoire français des conjonctures économiques)
    Abstract: This article examines how closely nanotechnology resembles a general purpose technology (GPT). Using patented nanotechnology inventions during 1975-2006, we test for characteristics of GPTs identified in the prior literature, and find evidence that nanotechnology shows both “pervasive” adoption and “spawning” of follow-on innovation. Offering a methodological contribution, we employ concentration indexes such as the Gini index and Lorenz curve to construct “knowledge dissemination curves” for different technologies, thereby providing evidence that nanotechnology shares relevant characteristics with other GPTs. Using an entirely new dataset, we use three different definitions of a “nanotechnology patent” and calculate patent generality indexes, finding that nanotechnology patents are significantly more likely to be referenced across technology space than are patents in information technology, another widely-adopted GPT. In another contribution, we suggest that innovative materials may demonstrate the characteristics of a GPT, and provide a historical parallel between the advancement of steel technology in the 19th Century with that of nanotechnology in the present day.
    Keywords: Nanotechnology; General Purpose Technology; Patent Analysis
    JEL: O30 O33 O34
    Date: 2014–12
  5. By: Carol Corrado; Olga Ukhaneva
    Abstract: This paper sets out a framework to estimate quality-adjusted price levels and price changes for fixed broadband services in OECD countries. We extend and adapt existing hedonic frameworks for international and interarea comparisons and consider the extended country product dummy approach. Hedonic pricing studies often are context and data dependent, and this study is no exception. We find that the multilevel structure of international broadband price datasets suggests modeling hedonic functions at the company level. This not only mitigates efficiency loss due to lack of subscriber information on individual plans but also allows for company costs and markups to influence estimates of hedonic function coefficients. Incorporating random variation in hedonic slope coefficients at the ISP level produces results that statistically dominate standard models where slope coefficients are the same across countries, and we suggest how price comparisons based on random coefficient hedonic models might be useful in telecommunications policy analysis.
    Keywords: comparability, broadband, price
    JEL: C23 C43 C82 E01 E31 F40 L16 L96
    Date: 2016–10–20

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