Effects of Local Versus Absentee Telephone Company Ownership on Participation in Rural Community Economic Development

Abstract

Acceleration of the Information Age has heightened the importance of telecommunicationsservices in the economic vitality of rural communities. The local telephone service provider is akey actor in the community's economic development activities, but telephone companyinvolvement in economic development varies significantly across communities. This articlefocuses on the effects of local ownership versus absentee ownership of telephone companies ontheir participation in local community economic development. Data from a study of communityeconomic development professionals in Iowa indicate a positive relationship between localtelephone company ownership and involvement with economic development efforts. Buildingupon the community of limited liability concept, it was found that the nature of local investmentsaffects participation in economic development. Implications of the results are discussed in thecontext of ongoing structural changes in the telecommunications industry.