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Endogenous Financing Of The Universal Service

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  • Laura Ilie

    ()

  • Ramiro Losada

    ()

Abstract

We address the question of endogenous financing of the Universal Service Obligations and we compare it with the exogenous financing. A fund is created and fed through a tax firms pay. We show that the way these funds are implemented by the current regulatory regimes at work goes against the social welfare. We propose a new way of implementing the fund that improves welfare. Moreover, we challenge the proportionality payment principle as it leads to lower welfare.

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Bibliographic Info

Paper provided by Universidad Carlos III, Departamento de Economía in its series Economics Working Papers with number we044116.

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Date of creation: Jul 2004
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Handle: RePEc:cte:werepe:we044116

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  1. Das Varma, Gopal, 2003. "Bidding for a process innovation under alternative modes of competition," International Journal of Industrial Organization, Elsevier, Elsevier, vol. 21(1), pages 15-37, January.
  2. Klemperer, Paul, 1999. "Auction Theory: a Guide to the Literature," CEPR Discussion Papers, C.E.P.R. Discussion Papers 2163, C.E.P.R. Discussion Papers.
  3. Chone, Philippe & Flochel, Laurent & Perrot, Anne, 2000. "Universal service obligations and competition," Information Economics and Policy, Elsevier, Elsevier, vol. 12(3), pages 249-259, September.
  4. Gasmi, F. & Laffont, J. J. & Sharkey, W. W., 2000. "Competition, universal service and telecommunications policy in developing countries," Information Economics and Policy, Elsevier, Elsevier, vol. 12(3), pages 221-248, September.
  5. Valletti, Tommaso M., 2000. "Introduction: Symposium on universal service obligation and competition," Information Economics and Policy, Elsevier, Elsevier, vol. 12(3), pages 205-210, September.
  6. Chone, Philippe & Flochel, Laurent & Perrot, Anne, 2002. "Allocating and funding universal service obligations in a competitive market," International Journal of Industrial Organization, Elsevier, Elsevier, vol. 20(9), pages 1247-1276, November.
  7. Caillaud, Bernard & Tirole, Jean, 2004. "Essential facility financing and market structure," Journal of Public Economics, Elsevier, Elsevier, vol. 88(3-4), pages 667-694, March.
  8. Paul R. Milgrom, 1985. "Auction Theory," Cowles Foundation Discussion Papers, Cowles Foundation for Research in Economics, Yale University 779, Cowles Foundation for Research in Economics, Yale University.
  9. Anton, James J. & Vander Weide, James H. & Vettas, Nikolaos, 2002. "Entry auctions and strategic behavior under cross-market price constraints," International Journal of Industrial Organization, Elsevier, Elsevier, vol. 20(5), pages 611-629, May.
  10. Philippe Chone & Laurent Flochel & Anne Perrot, 2000. "Allocating and Funding Universal Service Obligations in a Competitive Network Market," Econometric Society World Congress 2000 Contributed Papers, Econometric Society 0213, Econometric Society.
  11. Sorana, Valter, 2000. "Auctions for Universal Service Subsidies," Journal of Regulatory Economics, Springer, Springer, vol. 18(1), pages 33-58, July.
  12. Jean-Jacques Laffont & Jean Tirole, 2001. "Competition in Telecommunications," MIT Press Books, The MIT Press, The MIT Press, edition 1, volume 1, number 0262621509, December.
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Cited by:
  1. Mirabel, F. & Poudou, J.-C. & Roland, M., 2009. "Universal service obligations: The role of subsidization schemes," Information Economics and Policy, Elsevier, Elsevier, vol. 21(1), pages 1-9, February.

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