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The Diffusion of Cellular Telephony in Portugal before UMTS: A Time Series Approach

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  • Pedro Pereira

    ()
    (Autoridade da Concorrência)

  • José C. Pernías-Cerrillo

    ()
    (Universitat Jaume I, Castellón)

Abstract

In this paper, we propose a methodology to estimate diffusion processes that differs from the standard practice in two ways. First, we model the nonlinear long-run trend through the Richards curve, which is more flexible than the standard alternatives. Second, we propose a dynamic specification that accounts for: short-run dynamics, and a tendency to correct deviations from the nonlinear long-run trend. We apply the model to the diffusion of cellular telephony in Portugal. Statistical tests show that our model outperforms the standard diffusion models. We also use the model to characterize the diffusion process of the Portuguese cellular telephone industry, and test several hypothesis about the recent evolution of the industry.

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Bibliographic Info

Paper provided by Portuguese Competition Authority in its series Working Papers with number 08.

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Length: 21 pages
Date of creation: Mar 2005
Date of revision:
Handle: RePEc:pca:wpaper:08

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Cited by:
  1. Theologos Dergiades & Apostolos Dasilas, 2010. "Modelling and forecasting mobile telecommunication services: the case of Greece," Applied Economics Letters, Taylor & Francis Journals, vol. 17(18), pages 1823-1828.
  2. Lukasz Grzybowski & Pedro Pereira, 2007. "Merger Simulation in Mobile Telephony in Portugal," Review of Industrial Organization, Springer, vol. 31(3), pages 205-220, November.
  3. Lukasz Grzybowski & Pedro Pereira, 2006. "Simulation of Merger in Mobile Telephony in Portugal," Working Papers 06-22, NET Institute, revised Oct 2006.

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