In the News

A new report out today from NYU’s Institute for Policy Integrity encourages policymakers to apply an economic analysis to criminal justice policy. And such an analysis, the report says, would reach this conclusion: “Public safety can be prioritized and even improved at a lower cost than traditional incarceration, using techniques like behavioral therapy for young offenders, intensive supervision, or a new iteration of a drug court. “

Corporate opponents of Net Neutrality have been arguing that rules protecting an open Internet will stifle innovation and economic growth. But a new study says that is just plain false.

New York University Law School’s nonpartisan Institute for Policy Integrity says the Internet generates huge economic benefits for consumers – as much as $5,600 per user, per year.

Executive director Mike Livermore explains that the infrastructure of the Net – the wires, cables and other hardware – and the content that flows through that hardware – combine
to create value for the user. Livermore says that without Net Neutrality rules to keep the Internet an open, level playing field for everyone who uses it, the value to users could diminish.

A study by the Institute of Policy and Integrity at New York University has crunched some numbers and determined that the combination of network infrastructure and content that comprise the Internet offers significant economic value to consumers. The authors describe their methods below:

“The results suggest that the consumer surplus generated by the Internet is very large. The average survey respondent spent 114.5 minutes a day on the Internet recreationally. The benefits that use generates are equivalent to 5.2 percent to 7.1 percent of income. If we use the median income value of Pew’s survey, we find that individual consumers collect between $4,155 and $5,686 worth of value from the Internet per year. This estimate is big, but it is in the same neighborhood as those found by Goolsbe and Klenow. They found that the consumer benefits of the Internet were somewhere between 2 percent and 3 percent of total income. The amount of time consumers spend on the Internet suggests that they receive a great deal of benefit from access.”

A new report from the Institute for Policy Integrity at the NYU School of Law finds that a weakening of net neutrality rules might actually “reduce incentives to invest in Internet content and infrastructure.”

In sum, the authors determined that Web users “collect between $4,155 and $5,686 worth of value from the Internet per year.” And the report notes an end to net neutrality rules — the FCC’s version of which the authors describe as “imperfect” — could shift investment from content creation into service provision, reducing the value of the Internet to its users.

Anyone who’s shopped for health insurance knows what a headache the process can be. The disorienting maze of features, benefits, and coverage options can leave consumers under-protected even when they’ve overpaid.

The federal Department of Health and Human Services (HHS) is trying to create a clearer, better menu for policy holders to order from. Their idea is “Transparency Reporting,” a move aimed at streamlining the health insurance purchasing process by asking companies to summarize their policies in easier-to-understand ways.

According to some, the housing bubble came crashing down in the fall of 2008 partially due to the predatory lending practices of mortgage banks. Part of the problem may have been consumer confusion when it came to the fine print of complex financing arrangements. Unknowingly, homebuyers might have signed on for more than they could manage — a situation that consumer education could have ameliorated.

Michael Livermore, executive director of the Institute for Policy Integrity at New York University, told BNA March 21 that the CURB Act offers nothing new and would only prolong the rulemaking process.
“Right now, there are very strong analytical requirements that agencies have to go through before they adopt regulations,” Livermore said. “There are rules set up by courts under the Administrative Procedure Act and cost-benefit analysis rules that the president has in place. These requirements are comprehensive. They are designed so that agencies look at all the costs, all the benefits, and so that they only adopt rules that maximize net benefits. So [the CURB Act’s requirements] are redundant requirements that will just create more red tape for agencies. Supposedly this is about reducing red tape.”

The United States Court of Appeals for the District of Columbia Circuit ruled in April that the FCC did not have legal authority to stop Comcast, the nation’s largest cable provider, from blocking its customers’ access to a file-sharing service called BitTorrent. The decision limited the FCC’s power over web traffic under the current law and gave the ability for Internet service companies to block or slow specific sites. For example, they could decide to charge video sites like YouTube to deliver their content faster to users. “That’s the worst case scenario,” said Scott Holladay, an economics fellow at the Institute for Policy Integrity at New York University. “The likelihood of that happening is very small.”

Look for a court case to drag out for months and possibly end up before the U.S. Supreme Court, said Michael Livermore , executive director at the Institute for Policy Integrity at New York University School of Law. “This decision is on shaky legal ground so it is completely possible it would not be upheld,” he said. “But this is going to be the deal for at least 18 months to a couple years — a court challenge would take a while. As a result, for broadband, this compromise could just end up kicking the can down the road since there’s a good chance it gets overturned and we’ll have the larger net neutrality fight again in two years.”

To his credit, DeMint may have a point buried underneath all that silly rhetoric, and it has to down with how the FCC enacted Net Neutrality in the first place. The New York University School of Law’s Institute for Policy Integrity bemoaned [PDF] the fact that the FCC passed Net Neutrality not by “[invoking] it more robust regulating powers,” but that it “based the new rule on legal authority that was called into serious doubt by court decision earlier this year making the long term prospects for the rule quite poor.”