Does Broadband Subsidy Eligibility Increase Self-Employment? Evidence from the FCC Lifeline Program

Abstract

We examine whether eligibility for the FCC Lifeline broadband subsidy at the 135% Federal Poverty Level threshold affects self-employment and entrepreneurship. Using a regression discontinuity design with Census Bureau American Community Survey data from 2019-2022, we find that Lifeline eligibility increases broadband adoption by approximately 1.6-2.1 percentage points at narrow bandwidths (t-statistic = 5.3). However, we find no robust evidence that this increased broadband access translates into higher self-employment rates. The reduced-form effect on self-employment is small, statistically insignificant at narrow bandwidths, and changes sign across specifications. These results suggest that while broadband subsidies successfully increase internet adoption among low-income households, they may not be sufficient to stimulate entrepreneurship without complementary policies addressing other barriers to self-employment.