The employment and wage impact of broadband deployment in Canada

Hundreds of millions of dollars are spent by the Canadian federal and provincial governments to subsidize broadband deployment. This paper provides the first empirical assessment of the impact of broadband on employment and wage growth in Canada. Variation in elevation explains the regional difference in broadband coverage and is used as an instrument to estimate the causal effect. We find that the deployment of broadband in 1997-2011 promoted rural employment and wage growth in service industries. Goods industries were not impacted. The findings suggest that broadband helps service industry businesses overcome geographical barriers that have traditionally hampered rural growth.