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Universal service and the Telecommunications Act of 1996. The fact after the act

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  • Prieger, James

Abstract

Three goals of the 1996 Telecommunications Act are competition, efficiency, and explicit mechanisms to further universal service. The new universal service policies violate these goals. I review the policies (support for highcost and rural areas, low-income subscribers, and educational and medical institutions, and the funding mechanism) and detect the influence of various interest groups and the regulators' desire to protect their policies from public scrutiny. The new policies will require $4-12 billion per year to fund and create inefficiency of $1.2-4.0 billion per year from revenue taxation. A more efficient tax scheme would increase total surplus.

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  • Prieger, James, 1998. "Universal service and the Telecommunications Act of 1996. The fact after the act," Telecommunications Policy, Elsevier, vol. 22(1), pages 57-71, February.
    • Handle: RePEc:eee:telpol:v:22:y:1998:i:1:p:57-71
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    Cited by:

    1. Andrea Hoplight Tapia & Alison Powell & Julio Angel Ortiz, 2009. "Reforming policy to promote local broadband networks," LSE Research Online Documents on Economics 29458, London School of Economics and Political Science, LSE Library.

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