Bundling Demand in K-12 Broadband Procurement

Author:

Gaurab Aryal, Charles Murry, Pallavi Pal, Arnab Palit

Keyword:

Economics, General Economics, General Economics (econ.GN)

journal:

date:

2024-02-11 00:00:00

Abstract

We evaluate the effects of bundling demand for broadband internet by K-12 schools. In 2014, New Jersey switched from decentralized procurements to a new procurement system that bundled schools into four regional groups. Using an event study approach, we find that, on average, prices for participants decreased by one-third, and broadband speed purchased increased sixfold. We bound the change in school expenditures due to the program and find that participants saved at least as much as their total "E-rate" subsidy from the federal government. Under weak assumptions on demand, we show that participating schools experienced large welfare gains.

PDF: Bundling Demand in K-12 Broadband Procurement.pdf