The authors test opposing theories on how urban locations influenced the diffusion of Internet technology. They find … evidence that, controlling for industry, participation in the Internet is more likely in rural areas than in urban areas …. Nevertheless, talk of the dissolution of cities is premature. Frontier Internet technologies appear more often at establishments in …

) resources in process innovation. We draw on a rich data set of Internet investments by 86,879 U.S. establishments to examine … decisions to invest in advanced Internet technology. We find evidence of localization of substitution. In particular, we show …