Broadband Penetration and Economic Growth: Wired vs wireless

Yesterday the Wall Street Journal ran an interesting article distilling some of the OECD data looking at broadband and economic growth. The chart below paints a quick picture…

BBVsGDP

As the author points out…

What is striking is the graph reproduced right at the top, showing the correlation between broadband penetration — this is all broadband, not just fiber — and per capita GDP. The OECD has calculated the simple correlation to be 0.64. Without the outlier of Luxembourg the correlation goes up to 0.77. Correlation runs from -1 through 0 to 1 and a correlation greater than ±0.8 is generally described as strong, whereas a correlation less than ±0.5 is generally described as weak.

That’s interesting – but what interested in even more was the author’s follow up, which looked at wired versus wireless technology…

bbmobVsGDP_1

I was asked to look at the same data but for mobile broadband. The story is very different as you can see from the graph below. The simple correlation is only 0.48 (it goes up to 0.55 if you take out Luxembourg as an outlier) so it is a pretty weak correlation.

Wireless has its conveniences – but as these statistics highlight, there may be some lost benefits to a wireless-only solution. Something to consider as rural areas consider their broadband options; or their options are considered for them.

This entry was posted in economic development, Research, Wireless by Ann Treacy. Bookmark the permalink.

About Ann Treacy

Librarian who follows rural broadband in MN and good uses of new technology (blandinonbroadband.org), hosts a radio show on MN music (mostlyminnesota.com), supports people experiencing homelessness in Minnesota (elimstrongtowershelters.org) and helps with social justice issues through Women’s March MN.

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