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Scale Economies in Cellular Telephony: Size Matters

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  • Foreman, R Dean
  • Beauvais, Edward
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    Abstract

    Strategic positioning and potential cost savings are popular explanations for growing consolidation in the wireless telephone industry. This research estimates economies of scale for a large panel of GTE Wireless cellular market areas. Contrary to previous findings, our results indicate scale economies exist throughout the system and provide a rationale for the industry trend of consolidation. Copyright 1999 by Kluwer Academic Publishers

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    Bibliographic Info

    Article provided by Springer in its journal Journal of Regulatory Economics.

    Volume (Year): 16 (1999)
    Issue (Month): 3 (November)
    Pages: 297-306

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    Handle: RePEc:kap:regeco:v:16:y:1999:i:3:p:297-306

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    Web page: http://www.springerlink.com/link.asp?id=100298

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    Cited by:
    1. Joshua S. Gans & Stephen P. King & Julian Wright, 2005. "Wireless Communications," Development Research Unit Working Paper Series archive-45, Monash University, Department of Economics.
    2. Bloch, Harry, et al, 2001. "The Cost Structure of Australian Telecommunications," The Economic Record, The Economic Society of Australia, vol. 77(239), pages 338-50, December.
    3. Victor Glass & Stela Stefanova, 2012. "Economies of scale for broadband in rural United States," Journal of Regulatory Economics, Springer, vol. 41(1), pages 100-119, February.
    4. Gagnepain, Philippe & Pereira, Pedro, 2007. "Entry, costs reduction, and competition in the Portuguese mobile telephony industry," International Journal of Industrial Organization, Elsevier, vol. 25(3), pages 461-481, June.
    5. Gasmi, Farid & Ivaldi, Marc & Recuero Virto, Laura, 2009. "An Empirical Analysis of Cellular Demand in South Africa," TSE Working Papers 09-091, Toulouse School of Economics (TSE).
    6. Madden, Gary G & Coble-Neal, Grant & Dalzell, Brian, 2004. "A dynamic model of mobile telephony subscription incorporating a network effect," MPRA Paper 10829, University Library of Munich, Germany.
    7. Muck, Johannes & Heimeshoff, Ulrich, 2012. "First mover advantages in mobile telecommunications: Evidence from OECD countries," DICE Discussion Papers 71, Heinrich‐Heine‐Universität Düsseldorf, Düsseldorf Institute for Competition Economics (DICE).
    8. Tommaso Valletti, 2003. "Is Mobile Telephony a Natural Oligopoly?," Review of Industrial Organization, Springer, vol. 22(1), pages 47-65, February.
    9. Michael Crew & Paul Kleindorfer, 2012. "Regulatory economics and the journal of regulatory economics: a 30-year retrospective," Journal of Regulatory Economics, Springer, vol. 41(1), pages 1-18, February.
    10. Takanori Ida & Toshifumi Kuroda, 2009. "Discrete choice model analysis of mobile telephone service demand in Japan," Empirical Economics, Springer, vol. 36(1), pages 65-80, February.
    11. Ianchovichina, Elena & Estache, Antonio & Foucart, Renaud & Garsous, Gregoire & Yepes, Tito, 2012. "Job creation through infrastructure investment in the Middle East and North Africa," Policy Research Working Paper Series 6164, The World Bank.
    12. Vogelsang, Ingo, 2010. "The relationship between mobile and fixed-line communications: A survey," Information Economics and Policy, Elsevier, vol. 22(1), pages 4-17, March.

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