Date of Award

December 2021

Document Type

Thesis

Degree Name

Master of Arts (MA)

Department

Economics

Committee Member

Thomas W. Hazlett

Committee Member

F. Andrew Hanssen

Committee Member

Patrick L. Warren

Abstract

Is the value of broadband access capitalized in house prices, and do broadband subsidies transfer wealth to targeted subscribers? First, we sample 4995 recent rural Michigan home sales, with their attributes, to calibrate a hedonic model. Our estimation relates housing values to broadband internet access availability, while limiting endogeneity. A second model estimates federal broadband subsidy’s effect on availability of 25 Mbps (download) service. Results show a premium between 10-15% in home prices for broadband availability (a potential difference of $15,000-$22,500 with median home price of $150,000), while subsidies appear to not have any significant impact.

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