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The Complementarity between Calls and Messages in Mobile Telephony

Author

Listed:
  • Lukasz Grzybowski

    (University of Alicante)

  • Pedro Pereira

    (Autoridade da Concorrência)

Abstract

This article estimates the price elasticities of the demand for mobile telephone calls and the demand for messages for Portugal. We use a panel of individual level data. In order to account for the unobserved individual heterogeneity and for the data censoring, we estimate a Tobit model for panel data with individual random effects. The demand for calls and the demand for messages are inelastic. Calls and messages are complements.

Suggested Citation

  • Lukasz Grzybowski & Pedro Pereira, 2007. "The Complementarity between Calls and Messages in Mobile Telephony," Working Papers 27, Portuguese Competition Authority.
    • Handle: RePEc:pca:wpaper:27
    as

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    File URL: http://www.concorrencia.pt/download/WP27_CallsMessages.pdf
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    References listed on IDEAS

    as
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    Full references (including those not matched with items on IDEAS)

    Citations

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    Cited by:

    1. Zucchini, Leon & Kretschmer, Tobias, 2011. "Competitive Pressure: Competitive Dynamics as Reactions to Multiple Rivals," Discussion Papers in Business Administration 12308, University of Munich, Munich School of Management.
    2. Youngsoo Kim & Rahul Telang & William B. Vogt & Ramayya Krishnan, 2010. "An Empirical Analysis of Mobile Voice Service and SMS: A Structural Model," Management Science, INFORMS, vol. 56(2), pages 234-252, February.
    3. Wellmann, Nicolas, 2017. "OTT-Messaging and Mobile Telecommunication: A Joint Market? An Empirical Approach," 28th European Regional ITS Conference, Passau 2017 169503, International Telecommunications Society (ITS).
    4. Basalisco, Bruno, 2012. "The effect of user interaction on the demand for mobile text messages: Evidence from cross-country data," Information Economics and Policy, Elsevier, vol. 24(2), pages 132-144.
    5. Carlo Cambini & Tommaso M. Valletti, 2008. "Information Exchange And Competition In Communications Networks," Journal of Industrial Economics, Wiley Blackwell, vol. 56(4), pages 707-728, December.
    6. Wellmann, Nicolas, 2019. "Are OTT messaging and mobile telecommunication an interrelated market? An empirical analysis," Telecommunications Policy, Elsevier, vol. 43(9).
    7. Marius F. Niculescu & Seungjin Whang, 2012. "Research Note ---Codiffusion of Wireless Voice and Data Services: An Empirical Analysis of the Japanese Mobile Telecommunications Market," Information Systems Research, INFORMS, vol. 23(1), pages 260-279, March.
    8. Rui Wang, 2023. "Testing and Identifying Substitution and Complementarity Patterns," Papers 2304.00678, arXiv.org.
    9. Torsten J. Gerpott & Sandra Thomas & Michael Weichert, 2014. "Usage of established and novel mobile communication services: Substitutional, independent or complementary?," Information Systems Frontiers, Springer, vol. 16(3), pages 491-507, July.
    10. Lukasz Grzybowski & Pedro Pereira, 2011. "Subscription Choices and Switching Costs in Mobile Telephony," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 38(1), pages 23-42, January.
    11. Wellmann, Nicolas, 2017. "OTT-messaging and mobile telecommunication: A joint market? - An empirical approach," DICE Discussion Papers 256, Heinrich Heine University Düsseldorf, Düsseldorf Institute for Competition Economics (DICE).
    12. Vélez-Velásquez, Juan Sebastián, 2019. "Merger effects with product complementarity: Evidence from Colombia’s telecommunications," Information Economics and Policy, Elsevier, vol. 49(C).
    13. Vogelsang, Ingo, 2010. "The relationship between mobile and fixed-line communications: A survey," Information Economics and Policy, Elsevier, vol. 22(1), pages 4-17, March.
    14. Gerpott, Torsten J. & Meinert, Phil, 2016. "The impact of mobile Internet usage on mobile voice calling behavior: A two-level analysis of residential mobile communications customers in Germany," Telecommunications Policy, Elsevier, vol. 40(1), pages 62-76.

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    More about this item

    Keywords

    Mobile Telephony; Price Elasticities; SMS; Complementarity;
    All these keywords.

    JEL classification:

    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
    • L43 - Industrial Organization - - Antitrust Issues and Policies - - - Legal Monopolies and Regulation or Deregulation
    • L93 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Air Transportation

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