How do Internet shutdowns affect the economy?

What is it about?

Internet shutdowns have profound economic consequences that extend beyond disrupting communication networks. Despite existing research, the full impact on local economies remains underexplored. This study fills this gap by employing economic analysis to assess the effects of shutdowns on GDP, employment, and foreign investment across 92 countries. Findings reveal a significant correlation between shutdowns and a 15.6% decrease in GDP per capita, with each day costing $86.58 per person on average. This highlights the substantial economic toll of Internet disruptions, urging policymakers to consider these ramifications when implementing such measures.

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Why is it important?

Our study is an important step forward in terms of estimating the associated economic impacts of Internet shutdowns beyond communication disruptions. We use publicly available data and econometric methods to offer advanced insights into how shutdowns affect GDP, jobs, and investments in different regions. By providing evidence on the impacts of shutdowns, our study can empower policymakers to make informed decisions about Internet policies, fostering resilient and inclusive digital landscapes. In today's interconnected world, understanding these costs is vital for safeguarding economic prosperity and societal well-being. This study's timeliness lies in its ability to shed light on a pressing issue, potentially shaping future strategies to mitigate the adverse effects of Internet shutdowns globally.

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