The Role of Broadband Price Index in Fostering Economic Growth and Digitization in Europe

Abstract

This study analyzes the determinants of the "Broadband Price Index" in Europe. The data used refers to 28 European countries between 2016 and 2021. The database used is the Digital, Economy, and Society Index-DESI of the European Commission. The data were analyzed using the following econometric techniques, namely Panel Data with Random Effects, Panel Data with Fixed Effects, Pooled OLS, WLS and Dynamic Panel. The value of the "Broadband Price Index" is positively associated with the DESI Index and "Connectivity", while it is negatively associated with "Fixed Broadband Take Up", "Fixed Broadband Coverage", "Mobile Broadband", "e-Government", "Advanced Skills and Development", "Integration of Digital Technology", "At Least Basic Digital Skills", "Above Basic Digital Skills", and "At Least Basic Software Skills". A cluster analysis was carried out below using the k-Means algorithm optimized with the Silhouette coefficient. The analysis revealed the existence of three clusters. Finally, an analysis of the machine learning algorithms was carried out to predict the future value of the "Broadband Price Index". The result shows that the most useful algorithm for prediction is the Artificial Neural Network-ANN, with an estimated value equal to an amount of 9.21%. Doi: 10.28991/HEF-2022-03-01-03 Full Text: PDF