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What is the magnitude of fixed–mobile call substitution? Empirical evidence from 16 European countries

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  • Barth, Anne-Kathrin
  • Heimeshoff, Ulrich

Abstract

This paper investigates the degree of fixed–mobile call substitution (FMCS) within different European countries. We use quarterly data from 2004 to mid-2010 on 16 mainly Western European countries. By applying dynamic panel data techniques, we are able to estimate short- and long-run elasticities of the telecommunication usage prices on the fixed-line call demand. The own-price and cross-price elasticities found give strong empirical evidence for substitutional effects towards mobile services. In particular, the estimated cross-price elasticities of the mobile price on the fixed-line call demand are relatively large compared to other studies.

Suggested Citation

  • Barth, Anne-Kathrin & Heimeshoff, Ulrich, 2014. "What is the magnitude of fixed–mobile call substitution? Empirical evidence from 16 European countries," Telecommunications Policy, Elsevier, vol. 38(8), pages 771-782.
    • Handle: RePEc:eee:telpol:v:38:y:2014:i:8:p:771-782
    DOI: 10.1016/j.telpol.2014.04.009
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    Cited by:

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