Research and Publications: Department of Business Economics and Public Policy : Kelley School of Business: Indiana University

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The department is home to the authors of Managerial Economics and Business Strategy and Games and Information: An Introduction to Game Theory, two of the nation’s leading textbooks in the field.

Research and Publications

Journal Articles

Internet Adoption Patterns and Usage are Different: Implications for the Digital Divide

2008, Information Economics and Policy

Jeff Prince, Avi Goldfarb

Abstract

There is a well-documented a "digital divide" in internet connection. We ask whether a similar divide exists for internet usage. Using a survey of 18,439 Americans, we find that high-income, educated people were more likely to have adopted the internet by December 2001. However, conditional on adoption, low-income, less-educated people spend more time online. We examine four possible reasons for this pattern: 1) differences in the opportunity cost of leisure time, 2) differences in the usefulness of online activities, 3) differences in the amount of leisure time, and 4) selection. Our evidence suggests this pattern is best explained by differences in the opportunity cost of leisure time. Our results also help to determine the potential effects of internet-access subsidies.

Citation

Goldfarb, Avi and Jeff Prince (2008), "Internet Adoption Patterns and Usage are Different: Implications for the Digital Divide," Information Economics and Policy, Vol. 20, No. 1, pp. 2-15.

Keywords

internet adoption, digital divide