Advanced Search
MyIDEAS: Login to save this article or follow this journal

Efficient Price and Capacity Choices under Uncertain Demand: An Empirical Analysis

Contents:

Author Info

  • Koschat, Martin A
  • Srinagesh, Padmanabhan
  • Uhler, Linda J
Registered author(s):

    Abstract

    Traditional economic analyses of the peak-load problem typically assume an unrealistic degree of regularity in demand during well-defined peak and off-peak periods. This issue is addressed through a comprehensive statistical model that separates demand into its systematic and stochastic components. This model is combined with a traditional economic model and applied to local telephone service, leading to substantive conclusions relevant for managerial decisions as well as further research, among them: (1) Neglecting the systematic and stochastic structure of demand may lead to inefficient tariffs. Efficient measured service structures typically price individual calls below incremental capacity cost. (2) Industry wide capacity decision rules that are exclusively driven by blockage probability targets during narrowly defined time periods may be economically inefficient. (3) For telephone service, spot pricing, which sets high prices during periods of actual congestion, has the potential to be considerably more efficient than traditional tariffs that set high prices during periods of expected congestion. Copyright 1995 by Kluwer Academic Publishers

    Download Info

    To our knowledge, this item is not available for download. To find whether it is available, there are three options:
    1. Check below under "Related research" whether another version of this item is available online.
    2. Check on the provider's web page whether it is in fact available.
    3. Perform a search for a similarly titled item that would be available.

    Bibliographic Info

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

    Volume (Year): 7 (1995)
    Issue (Month): 1 (January)
    Pages: 5-26

    as in new window
    Handle: RePEc:kap:regeco:v:7:y:1995:i:1:p:5-26

    Contact details of provider:
    Web page: http://www.springerlink.com/link.asp?id=100298

    Related research

    Keywords:

    References

    No references listed on IDEAS
    You can help add them by filling out this form.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as in new window

    Cited by:
    1. Joan Calzada Aymerich, 2003. "Access by Capacity and Peak-Load Pricing," Working Papers in Economics 108, Universitat de Barcelona. Espai de Recerca en Economia.
    2. Joan Calzada, 2007. "Capacity-based versus time-based access charges in telecommunications," Journal of Regulatory Economics, Springer, vol. 32(2), pages 153-172, October.
    3. Skiera, Bernd & Spann, Martin, 1999. "The ability to compensate for suboptimal capacity decisions by optimal pricing decisions," European Journal of Operational Research, Elsevier, vol. 118(3), pages 450-463, November.

    Lists

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    Statistics

    Access and download statistics

    Corrections

    When requesting a correction, please mention this item's handle: RePEc:kap:regeco:v:7:y:1995:i:1:p:5-26. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Guenther Eichhorn) or (Christopher F. Baum).

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If references are entirely missing, you can add them using this form.

    If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.