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Regulation and Internet Use in Developing Countries

Policymakers are simultaneously concerned about the consequences of a worsening "digital divide" between rich and poor countries and hopeful that information and computing technologies could increase economic growth in developing countries. But very little research has explored the reasons for the digital divide beyond noting that it is strongly correlated with standard development indicators, and no empirical research has explored the role of regulation.

Wallsten uses data from a unique new survey of telecommunications regulators and other sources to measure the effects of regulation in Internet development. He finds regulation strongly correlated with lower Internet penetration and higher Internet access charges. More specifically, controlling for factors such as income, development of the telecommunications infrastructure, ubiquity of personal computers, and time trends, countries that require formal regulatory approval for Internet service providers (ISPs) to begin operations have fewer Internet users and Internet hosts than countries that do not require such approval. Moreover, countries that regulate ISP final-user prices have higher Internet access prices than countries that do not have such regulations. These results suggest that developing countries' own regulatory policies can have large impacts on the digital divide.

This paper-a product of Investment Climate, Development Research Group-is part of a larger effort in the group to understand regulatory and infrastructure sector reforms.


Publication of second annual report on cyberspace : "The Internet under Surveillance - Obstacles to the free flow of information online"
The Internet is the bane of all dictatorial regimes, but even in democracies, new anti-terrorism laws have tightened government control of it and undermined the principle of protecting journalistic sources. This report is about attitudes to the Internet by the powerful in 60 countries, between spring 2001 and spring 2003. The preface is by Vinton G. Cerf, who is often called the "father" of the Internet.


Google Censorship - How It Works
This report describes the system by which results in the Google search engine are suppressed. Google is arguably the world's most popular search engine. However, contrary perhaps to a naive impression, in some cases the results of a search are affected by various government-related factors. That is, search results which may otherwise be shown, are deliberately excluded. The suppression may be local to a country, or global to all Google results.


Internet use in CEECs catching up with Western Europe
(EU Business: 19/02/2003)
Internet use in Central and Eastern European countries (CEECs) is catching up with that of Western Europe, according to a new study by market analysts IDC.
The percentage of the population using the Internet at least once a month in the region is expected to reach 17 per cent in 2003 and 27 per cent in 2006. The growth is driven predominantly by use in the workplace and schools.


Wide Band
The European Union must accelerate the changeover to broadband services and third generation mobile communications. The report identifies broadband and "3G" as the main drivers of the sector. The economic and social benefits they bring make it more urgent than ever that the availability and use of these technologies be improved.

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