Asymmetric Regulation of Access and Price Discrimination in Telecommunications
AbstractSuppose that a strong and a weak operator compete in a telecommunications market. To terminate a call operators need access to the competitor’s network if the call is off-net. Operators set two-part tariffs and price-discriminate according to termination of a call. Suppose as a benchmark that access prices are regulated at costs. I show that the weak operator’s profit and consumer welfare increase if the regulator sets a higher price to access the weak operator’s network. However, total surplus decreases even locally. Copyright Springer Science+Business Media, Inc. 2005
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Bibliographic InfoArticle provided by Springer in its journal Journal of Regulatory Economics.
Volume (Year): 28 (2005)
Issue (Month): 3 (November)
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Web page: http://www.springerlink.com/link.asp?id=100298
access price; entry; interconnection charge; regulation; telecommunications; termination-based price discrimination; L96; L51; L13;
Find related papers by JEL classification:
- L96 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Telecommunications
- L51 - Industrial Organization - - Regulation and Industrial Policy - - - Economics of Regulation
- L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
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