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When Should an Incumbent be Obliged to Share its Infrastructure with an Entrant Under the General Competition Rules?

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  • Mats Bergman

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    Abstract

    According to the essential-facilities doctrine, competition law requires an infrastructural monopoly to provide access. Under the “Bronner criterion”, proposed by the EC Court, the doctrine is only applicable when a symmetric infrastructural duopoly is non-viable. This paper uses a simple model to illustrate that, from a welfare point-of-view, the Bronner criterion may provide too little monopoly protection for the incumbent in high-risk new markets, while requiring too much investments from the entrant in low-risk mature markets. Copyright Springer Science Business Media, Inc. 2005

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    File URL: http://hdl.handle.net/10.1007/s10842-005-0990-7
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    Bibliographic Info

    Article provided by Springer in its journal Journal of Industry, Competition and Trade.

    Volume (Year): 5 (2005)
    Issue (Month): 1 (January)
    Pages: 5-26

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    Handle: RePEc:kap:jincot:v:5:y:2005:i:1:p:5-26

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    Web page: http://springerlink.metapress.com/link.asp?id=105724

    Related research

    Keywords: infrastructure; access regulation; competition law; antitrust; bronner;

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    1. Bergman, Mats A., 1998. "Endogenous Timing of Investments Yields Modified Stackelberg Outcomes," Working Paper Series in Economics and Finance 272, Stockholm School of Economics.
    2. Mark Armstrong & Simon Cowan & John Vickers, 1994. "Regulatory Reform: Economic Analysis and British Experience," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262510790, December.
    3. Gans, Joshua S, 2001. "Regulating Private Infrastructure Investment: Optimal Pricing for Access to Essential Facilities," Journal of Regulatory Economics, Springer, vol. 20(2), pages 167-89, September.
    4. Armstrong, Mark, 2001. "The theory of access pricing and interconnection," MPRA Paper 15608, University Library of Munich, Germany.
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    Cited by:
    1. Foros, Øystein & Kind, Hans Jarle & Sand, Jan Yngve, 2009. "Entry may increase network providers' profit," Telecommunications Policy, Elsevier, vol. 33(9), pages 486-494, October.

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