Economic Benefits of Fiber Deployment: A Review of the Brattle Group Study

The Infrastructure Investment and Jobs Act provided over $42 billion in subsidies for broadband deployment via the Broadband Equity, Access, and Deployment program. Although BEAD funds are supposed to be disbursed on a technology-neutral basis, the Biden Administration mandated a preference for fiber deployment, even when alternative technologies—including satellite broadband—are the more efficient mechanism to serve certain high-cost areas. With the recent election of President Donald Trump to the presidency, the government’s preference for fiber now faces significant uncertainty. In this context, the Brattle Group released a commissioned study claiming substantial economic benefits from fiber deployment based on a Differences-in-Differences regression model. In this bulletin, I describe several methodological problems in the Brattle Group’s approach, including a failure to evaluate key assumptions of DID models and the misspecification of the regression models, and then evaluate their study’s findings using the same data sources.