Sender or Receiver: Who Should Pay to Exchange an Electronic Message?
AbstractWe examine the pricing implications of call externalities, the benefits enjoyed by the recipient of a message sent by another user. We show that, with or without a network-profitability constraint, efficient pricing requires consideration of demands, as well as costs. We present conditions under which equal charges for sending and receiving calls maximize welfare and profits. We also present conditions under which the receiving party's subsidizing the sender maximizes welfare and profits. Last, we show that menus of pricing options can increase welfare and profits. None of these findings holds in the absence of call externalities.
Download InfoTo 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 InfoArticle provided by The RAND Corporation in its journal RAND Journal of Economics.
Volume (Year): 35 (2004)
Issue (Month): 3 (Autumn)
Contact details of provider:
Web page: http://www.rje.org
You can help add them by filling out this form.
CitEc Project, subscribe to its RSS feed for this item.
- Wilko Bolt & Sujit Chakravorti, 2008.
"Consumer choice and merchant acceptance of payment media,"
Working Paper Series
WP-08-11, Federal Reserve Bank of Chicago.
- Wilko Bolt & Sujit Chakravorti, 2008. "Consumer Choice and Merchant Acceptance of Payment Media," DNB Working Papers 197, Netherlands Central Bank, Research Department.
- Baranes, Edmond & Poudou, Jean-Christophe, 2011.
"Internet access and investment incentives for broadband service providers,"
22nd European Regional ITS Conference, Budapest 2011: Innovative ICT Applications - Emerging Regulatory, Economic and Policy Issues
52196, International Telecommunications Society (ITS).
- Edmond Baranes & Jean-Christophe Poudou, 2011. "Internet access and investment incentives for broadband service providers," Working Papers 11-09, LAMETA, Universtiy of Montpellier, revised Apr 2011.
- Hoernig, Steffen, 2010. "Competition Between Multiple Asymmetric Networks: Theory and Applications," CEPR Discussion Papers 8060, C.E.P.R. Discussion Papers.
- Simon P. Anderson & André De Palma, 2008.
- Michael L. Katz, 2005. "What do we know about interchange fees and what does it mean for public policy? : commentary on Evans and Schmalensee," Proceedings – Payments System Research Conferences, Federal Reserve Bank of Kansas City, issue May, pages 121-137.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ().
If references are entirely missing, you can add them using this form.