The Welfare Effects of Mobile Termination Rate Regulation in Asymmetric Oligopolies: the Case of Spain
AbstractWe examine the effects of mobile termination rate regulation in asymmetric oligopolies. We do this by extending existing models of asymmetric duopoly and symmetric oligopoly where consumer expectations about market shares are passive. We first calibrate product differentiation parameters using detailed data from the Spanish market from 2010. Next, we predict equilibrium outcomes and welfare effects under alternative scenarios of future termination rates. Lowering termination rates typically lowers profits of all networks and improves consumer and total surplus.
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Bibliographic InfoPaper provided by NET Institute in its series Working Papers with number 11-09.
Length: 19 pages
Date of creation: Oct 2011
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Mobile Termination Rates; Network Effects; Simulations; Telecommunications; Welfare;
Find related papers by JEL classification:
- D43 - Microeconomics - - Market Structure and Pricing - - - Oligopoly and Other Forms of Market Imperfection
- K23 - Law and Economics - - Regulation and Business Law - - - Regulated Industries and Administrative Law
- L51 - Industrial Organization - - Regulation and Industrial Policy - - - Economics of Regulation
- L96 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Telecommunications
This paper has been announced in the following NEP Reports:
- NEP-ALL-2011-11-07 (All new papers)
- NEP-COM-2011-11-07 (Industrial Competition)
- NEP-IND-2011-11-07 (Industrial Organization)
- NEP-REG-2011-11-07 (Regulation)
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