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Calling Patterns and Usage of Residential Toll Service under Self-Selecting Tariffs

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  • Lee, Bosang

Abstract

Using a nested logit model, we empirically show how self-selecting tariffs with basic and OCP (Optional Calling Plan) service options affect households' calling patterns and usage of interstate toll service in the United States. We find, first, that households are more sensitive to price declines than to price increases in terms of both consumption and expenditures. Second, households respond more sensitively to OCP price changes than to basic service price changes. Third, consumption changes are more sensitive than expenditures, indicating that households adjust their calling patterns or service options so as to keep expenditures on telephone bills relatively constant. Copyright 1999 by Kluwer Academic Publishers

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  • Lee, Bosang, 1999. "Calling Patterns and Usage of Residential Toll Service under Self-Selecting Tariffs," Journal of Regulatory Economics, Springer, vol. 16(1), pages 45-81, July.
    • Handle: RePEc:kap:regeco:v:16:y:1999:i:1:p:45-81
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    1. repec:rri:wpaper:200704 is not listed on IDEAS
    2. Wang, Jin, 2021. "Do birds of a feather flock together? Platform’s quality screening and end-users’ choices theory and empirical study of online trading platforms," International Journal of Industrial Organization, Elsevier, vol. 75(C).
    3. Batley, Richard & Hess, Stephane, 2016. "Testing for regularity and stochastic transitivity using the structural parameter of nested logit," Transportation Research Part B: Methodological, Elsevier, vol. 93(PA), pages 355-376.
    4. Mara Thiene & Riccardo Scarpa, 2008. "Hiking in the Alps: Exploring Substitution Patterns of Hiking Destinations," Tourism Economics, , vol. 14(2), pages 263-282, June.
    5. Domanski, Adam, 2009. "Estimating Mixed Logit Recreation Demand Models With Large Choice Sets," 2009 Annual Meeting, July 26-28, 2009, Milwaukee, Wisconsin 49413, Agricultural and Applied Economics Association.
    6. James M. Davis & Guillermo Gallego & Huseyin Topaloglu, 2014. "Assortment Optimization Under Variants of the Nested Logit Model," Operations Research, INFORMS, vol. 62(2), pages 250-273, April.
    7. Tan, Jonathan H.W. & Breitmoser, Yves & Bolle, Friedel, 2015. "Voluntary contributions by consent or dissent," Games and Economic Behavior, Elsevier, vol. 92(C), pages 106-121.
    8. Breitmoser, Yves, 2010. "Hierarchical Reasoning versus Iterated Reasoning in p-Beauty Contest Guessing Games," MPRA Paper 19893, University Library of Munich, Germany.
    9. Alfandari, Laurent & Hassanzadeh, Alborz & Ljubic, Ivana, 2020. "An Exact Method for Assortment Optimization under the Nested Logit Model," ESSEC Working Papers WP2001, ESSEC Research Center, ESSEC Business School, revised 2020.
    10. Christiadi & Brian Cushing, 2007. "Conditional Logit, IIA, and Alternatives for Estimating Models of Interstate Migration," Working Papers Working Paper 2007-04, Regional Research Institute, West Virginia University.
    11. Matthew Kovach & Gerelt Tserenjigmid, 2022. "Behavioral Foundations of Nested Stochastic Choice and Nested Logit," Journal of Political Economy, University of Chicago Press, vol. 130(9), pages 2411-2461.
    12. Salon, Deborah, 2009. "Neighborhoods, cars, and commuting in New York City: A discrete choice approach," Transportation Research Part A: Policy and Practice, Elsevier, vol. 43(2), pages 180-196, February.

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