Broadband infrastructure and unemployment : evidence for Germany

Online job search is becoming increasingly prominent and is viewed to improve the efficiency of the search process. OLS results suggest a negative association of DSL availability with unemployment rates across German municipalities. However, the roll-out of DSL networks is not random. This paper exploits the fact that the availability of DSL connections depends on a municipality's distance to the closest interconnection point to the pre-existing voice-telephony network. Instrumental-variable results using this distance as an instrument for DSL availability do not confirm the effect of DSL availability on unemployment.