Economic development and public enterprise: The case of rural Iowa's telecommunications utilities

Abstract

This article examines the creation of public enterprises as a form of economic development for rural American communities. These public enterprises have a beneficial economic development role to play when there is a private sector failure to deliver high-quality, low-cost services in critical economic areas. The study examines Iowa's advanced telecommunications services in rural areas. Some rural areas perceive themselves to be well served by the private sector, but others perceive themselves to be woefully underserved. When rural Iowa communities believed themselves to be deprived of market-based services, they created public enterprise telecommunications utilities. Factors necessary for high-quality public enterprise telecommunication system success (as well as those leading to failure) are discussed. Also discussed are trends showing the importance of the new public enterprise telecommunications utilities.