General IS Topics
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Paper Number
1223
Paper Type
Completed
Description
Disruptive digital infrastructure is changing the landscape of the new economy. This research presents the first empirical analysis of how the development of an important digital infrastructure, a 5G high-speed network, reshapes mobile app consumption. We compile a new and unique dataset comprising mobile app consumption along with local 5G infrastructure buildout data across 30 major cities in China across a 12-month period in 2019. Our econometric analysis provides strong and robust evidence that digital infrastructure has a significant positive spillover effect on mobile app consumption. Such an effect is moderated by app categories—bandwidth-intensive and latency-sensitive apps benefit the most. Moreover, we find that the potential mechanisms have to do with increased 5G phone adoption and the commercialization of the 5G mobile plan. Furthermore, our post hoc analyses show that developing 5G infrastructure can help mitigate the digital divide between the most developed cities and less developed cities and can lead to significant positive economic outcomes.
Recommended Citation
Sun, Chenshuo and Ghose, Anindya, "The Economics of 5G and the Mobile Economy" (2021). ICIS 2021 Proceedings. 3.
https://aisel.aisnet.org/icis2021/gen_topics/gen_topics/3
The Economics of 5G and the Mobile Economy
Disruptive digital infrastructure is changing the landscape of the new economy. This research presents the first empirical analysis of how the development of an important digital infrastructure, a 5G high-speed network, reshapes mobile app consumption. We compile a new and unique dataset comprising mobile app consumption along with local 5G infrastructure buildout data across 30 major cities in China across a 12-month period in 2019. Our econometric analysis provides strong and robust evidence that digital infrastructure has a significant positive spillover effect on mobile app consumption. Such an effect is moderated by app categories—bandwidth-intensive and latency-sensitive apps benefit the most. Moreover, we find that the potential mechanisms have to do with increased 5G phone adoption and the commercialization of the 5G mobile plan. Furthermore, our post hoc analyses show that developing 5G infrastructure can help mitigate the digital divide between the most developed cities and less developed cities and can lead to significant positive economic outcomes.
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