Complementarity of Broadband Internet and College Majors: Lessons from Norwegian Vacancy Data

Broadband internet increases the hourly wages of college-educated workers. However, little is known about how broadband internet affects the wages of workers with different college majors. I combine several Norwegian data sets to answer this question. A public program with limited funding rolled out broadband infrastructure and provided plausibly exogenous variation in broadband internet coverage. I show substantial heterogeneity in the effect of broadband coverage on hourly wages across college majors. Law and Business graduates have the highest increase in hourly wages, while the effect for STEM graduates is similar to the average among all college-educated workers, and workers with Teaching major experience a decrease in their hourly wage. I explore possible explanations for this heterogeneity using information about Internet and Communication Technologies (ICT) skills from the near-population of vacancies and about ICT applications adopted in firms from a representative annual survey. I find evidence that broadband internet availability increases demand for General ICT skills and Basic ICT applications complementary to managerial skills. In contrast, I find substantially smaller or no effect for Advanced ICT skills and applications requiring technical expertise.