On the nature of price competition under universal service obligations: a note
AbstractThe imposition of universal coverage and uniform pricing constraints, as part of the universal service obligations, makes the universal service provider less aggressive in the price game when it competes with a rm that does not cover the whole set of markets (Valletti et al., 2002). In this paper, we fully characterize the resulting price equilibrium when universal service obligations are imposed. With a limited market coverage by the entrant or a small degree of degree of product di erentiation, the equilibrium is a mixed strategy one.
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Bibliographic InfoPaper provided by Université catholique de Louvain, Center for Operations Research and Econometrics (CORE) in its series CORE Discussion Papers with number 2009032.
Date of creation: 01 May 2009
Date of revision:
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universal service obligations; uniform pricing; price competition;
Other versions of this item:
- Axel Gautier & Xavier Wauthy, 2009. "On the Nature of Price Competition Under Universal Service Obligations: a Note," CREPP Working Papers 0901, Centre de Recherche en Economie Publique et de la Population (CREPP) (Research Center on Public and Population Economics) HEC-Management School, University of Liège.
- L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
- L51 - Industrial Organization - - Regulation and Industrial Policy - - - Economics of Regulation
This paper has been announced in the following NEP Reports:
- NEP-ALL-2010-03-28 (All new papers)
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