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Research Roundup #4

Research Roundup #4

We’re well into another sweltering summer here in the District, with policy debates that seem to raise the mercury even higher.  Take a few minutes to cool down with a crisp, refreshing study from the authors below.  Don’t miss the Vigdor and Ladd piece, which provocatively argues that “students who gain access to a home computer between 5th and 8th grade tend to witness a persistent decline in reading and math test scores.”  Readers with a mind for engineering over economics may prefer Bauer, Clark, and Lehr’s thorough analysis of “speed” definition and measurement in “high-speed Internet access.”  And of course there are a few articles for the lawyer in all of us, including two on intellectual property rights.

(Click through to the full post to see the list of papers and abstract excerpts)

Tech and Macroeconomics

Jacob L. Vigdor, Helen F. Ladd

“Does differential access to computer technology at home compound the educational disparities between rich and poor? Would a program of government provision of computers to early secondary school students reduce these disparities? We use administrative data on North Carolina public school students to corroborate earlier surveys that document broad racial and socioeconomic gaps in home computer access and use. Using within-student variation in home computer access, and across-ZIP code variation in the timing of the introduction of high-speed internet service, we also demonstrate that the introduction of home computer technology is associated with modest but statistically significant and persistent negative impacts on student math and reading test scores. Further evidence suggests that providing universal access to home computers and high-speed internet access would broaden, rather than narrow, math and reading achievement gaps.”

Lawrence Edwards, Robert Z. Lawrence

In this paper we show on the contrary [to claims that goods produced in the US and developing countries are close substitutes]… there are distinctive patterns of internationalspecialization and that developed and developing countries export fundamentally different products, especially those classified as high tech.”

Energy

Elias Leake Quinn, Adam Reed

“Will regulation guide the structure and usability of the smart grid, or will the ways in which the smart grid is already being applied force specific types of regulation? Early decisions by regulators will surely influence the balancing of policy concerns later in the smart grid development process; yet these decisions will be made in a regulatory environment in which utilities may lack the proper incentives to promote energy efficiency and consumer awareness – both functions of the smart grid. This Article examines economic and legal constraints in current utility regulation and describes the policy concerns which impact regulators’ decisions…”

Paolo Nardi

“[T]his paper will propose an empirical analysis to evaluate whether, and to what extent, unbundling measures are related to the increase of grid investments, focusing on UCTE [Union for the Co-ordination of Transmission of Electricity] countries between 2000 and 2006. Results are twisted: unbundling tout court cannot be related to a consistent enlargement of the grid, while quality performance is better than in not unbundled systems.”

Hans Andeweg, Andre Dorsman, Kees Van Montfort

“This article describes a value-creating trade strategy on the basis of the prices of electricity in The Netherlands and Germany, making use of the restricted electricity traffic between the two countries, providing empirical evidence on exploitable pricing inefficiencies in the electricity markets and potential trading strategies based thereupon.”

Innovation and Entrepreneurship

Lianxi Zhou, Bradley Barnes, Yuan Lu

This study fills a gap in the under-researched area of literature surrounding INVs [International New Ventures] from emerging economies, and demonstrates how young international venturing firms can leverage the entrepreneurial dynamics of learning to achieve growth opportunities from early internationalization.”

Peter J. Boettke, Christopher J. Coyne

“We explore the relevant literature from institutional economics and entrepreneurial studies, focusing on the important link between the two. Particular emphasis is placed on entrepreneurship within several different institutional settings – private for-profit, private non-profit and political – as well as the impact of entrepreneurship on institutions.”

Magnus Henrekson, Dan Johansson

High-growth firms (HGFs) are critical for net job creation and economic growth. We analyze “HGFs using the theory of competence blocs, linking firm growth to property rights and the interaction of complementary expertise. Specifically, we discuss how the institutional framework affects the prevalence and performance of HGFs.”

Net Neutrality

Christiaan Hogendorn

“This essay examines three sources of benefits from the Internet – general purpose technology, network effects, and innovation – and evaluates whether they could in fact be reduced by private, potentially non-neutral behavior by ISPs.”

Nicholas Economides

“I examine the possible impact of last-mile broadband providers’ imposing “termination fees” on third-party content providers or application providers to reach end-users. Broadband providers would engage in paid prioritization arrangements – that is, application and content providers could pay the broadband provider to have their traffic prioritized over competitors’ services. I argue that these arrangements would create inefficiency in the market and harm innovation. Because the last mile access broadband market is concentrated and consumers face switching costs, these concerns are particularly significant… [E]vidence suggests networks invest more under non-discrimination requirements, and paid prioritization schemes would divert money towards managing scarcity instead of expanding capacity. Paid prioritization could even create an incentive for broadband providers to create congestion to increase the price of prioritized service.”

Zouhaïer M’Chirgui, Thierry Pénard

“This article argues that Internet services providers should form strategic alliances to coordinate their investments in a new-generation infrastructure and provide innovative services with QoS guarantees.”

Nicholas Economides

“Newly available data confirm that there is limited competition in the broadband access marketplace. Contrary to some others’ arguments, wireless broadband access services are unlikely to act as effective economic substitutes for wireline broadband access services (whether offered by telephone companies or cable operators) and instead are likely to act as a complement. Nor will competition in the Internet backbone marketplace constrain broadband providers’ behavior in providing “last mile” broadband access services. The last mile, concentrated market structure, combined with high switching costs, provides last mile broadband network providers with the ability to engage in practices that will reduce social welfare in the absence of open broadband rules. Furthermore, the effect of open broadband rules on broadband provider revenues is likely to be small and can be either positive or negative.”

Christopher Marsden

“Eschewing technical, economic or legalistic explanations which he has previously tackled elsewhere, he explains that increasing Internet Service Provider (ISP) control over content risks not just differentiated pricing and speed on the Internet, but also removing the ‘Three Wise Monkeys’ liability regime for ISPs…”

Competition and Antitrust

Bronwyn E. Howell

“New Zealand’s “light-handed” regulation, instituted in 1987, attempted to enshrine the pursuit of efficiency into statute, first by relying solely upon competition law and contractual undertakings and subsequently creating a regulatory body with an explicit legislated efficiency directive. In practice, however, the inability of a government prioritizing efficiency to bind its successors to pursue the same objective renders sector strategy, and hence the efficiency objective, subject to political capture.”

Privacy

Angela Daly

“Legal problems have already been created by the use of deep packet inspection, which involve fundamental rights (especially of Internet users), such as freedom of expression and privacy, as well as more economic concerns, such as competition and copyright. These issues will be considered, and an assessment of the conformity of the use of deep packet inspection with law will be made.”

Security

Mike Hammock

“In the last ten years economists have become interested in the role of online security in promoting online commerce. This paper reviews the literature, with a focus on the role of incentives in creating and solving security problems, as well as discussion of the scale of the problem, and implications for the future of the internet, including cloud computing.”

Broadband

Steve Bauer, David Clark, William Lehr

“Broadband speed has emerged as the single most commonly cited metric for characterizing the quality of broadband offerings. However speed measurements for the same service can vary significantly. These differences arise from a complex set of factors including different test methodologies and test conditions…”

Gerald R. Faulhaber

“Broadband Internet Service Providers have been the subject of recent debate about the future of the Internet, with transparency being of particular concern: Are broadband ISPs (and other Internet firms) sufficiently transparent in their service offerings to customers?”

George S. Ford, Lawrence J. Spiwak

“We demonstrate that a “light touch” toward regulating broadband is not a credible commitment. Moreover, we use the current Commission’s own actions to demonstrate it lacks the necessary self-discipline or mindset for “light touch” regulation. Next, we consider the investment effects of reclassification using a theoretical model of investment… Although the Chairman’s “Third Way” may provide the Commission with a perceived blanket of legal comfort, that legal certainty comes at the expense of financial uncertainty.”

T. Randolph Beard, George S. Ford, Lawrence J. Spiwak, Michael L. Stern

“Countries around the world are increasingly concerned as to whether the adoption of broadband technology by their respective citizens is sufficient to support economic growth and social development. Unfortunately, such concerns are often expressed in terms of where a country ranks among its peers by means of raw adoption numbers. Such raw data are often misleading and incomplete. In this Article, we propose a different and more policy-relevant approach to adoption measurement. We develop a value-based Broadband Adoption Index (BAI) that compares the actual value to society that results from the adoption of broadband technology to a target level of adoption value.”

Intellectual Property

Alina Ng

This Article examines the general social claim to a right of access to information for the purposes of furthering the constitutional goals of promoting progress, and proposes that the question of access to information is a question of sustainable resource use that should not evoke the exclusionary rights of a strict property rule. The rights under copyright laws protect economic privileges in information and govern society’s use of informational resources. They do not provide copyright owners with a general right to exclude socially beneficial uses of informational works, are specifically tailored to increase social welfare, and must be distinguished from a property right to exclude others from use of a thing…”

Harsh Gagrani

“In the author’s opinion, excessively regulating the digital media can impede creativity and innovation. As will be shown in the essay with the help of examples from the past, creativity has flourished only in a culture reasonably balanced in the favour of public, as opposed to the copyright owners.”

Wireless and Spectrum

Hauke H. F. Plambeck

“Chapter 1 of this thesis highlights the positive impact of mobile telecommunication on the social and economic life in Sub Saharan Africa. Chapter 2 builds on the static as well as the dynamic version of the Network Pricing Game, a model developed by Dr. Carolyn Gideon, to stress the immanent threat of network markets turning into a monopoly. This theses ends in Chapter 3 with an brief outlook on further drivers of economic growth and opportunities awaiting Sub Saharan Africa in the coming decade.”

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