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Behind the scenes of the telecommunications miracle: An empirical analysis of the Indian market

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  • Biancini, Sara

Abstract

The paper analyzes the demand and supply characteristics of the Indian telecommunications market, with the aim of contributing to the debate on the effectiveness of universal access policies in developing countries. The discussion is supported by some empirical evidence derived from a small time-series-cross-section dataset, containing mainly information on the fixed-lines segment of the market. The analysis suggests that the price elasticity of demand for fixed lines might be sensibly higher than the levels usually found in developed countries, while the crucial role of income and other sociodemographic variables seems to be confirmed. The paper also studies the impact of cellular penetration on fixed-lines diffusion. The results suggest the existence of a (positive) network effect in low penetration areas, while substitution (displacement) seems to arise in the most developed ones. Finally, the paper analyzes the supply side of the market, to assess the impact of market competition on investment. Competition seemingly helps stimulating investment in the most developed areas, but does not seem to have a significant impact in the less developed ones.

Suggested Citation

  • Biancini, Sara, 2011. "Behind the scenes of the telecommunications miracle: An empirical analysis of the Indian market," Telecommunications Policy, Elsevier, vol. 35(3), pages 238-249, April.
    • Handle: RePEc:eee:telpol:v:35:y:2011:i:3:p:238-249
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    Cited by:

    1. Barman, Hemanta & Dutta, Mrinal Kanti & Nath, Hiranya K., 2018. "The telecommunications divide among Indian states," Telecommunications Policy, Elsevier, vol. 42(7), pages 530-551.
    2. Ünver, Mehmet Bilal & Göktaylar, Yavuz & Tezel, Fatih, 2015. "Regulatory Implications of FMS for Voice Services in Turkey: Analysis of Recent Regulatory Acts on Deregulation and Margin Squeeze," 26th European Regional ITS Conference, Madrid 2015 127186, International Telecommunications Society (ITS).
    3. Arunabha Mukhopadhyay & Kallol K. Bagchi & Godwin John Udo, 2024. "Exploring the Main Factors Affecting Mobile Phone Growth Rates in Indian States," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 15(2), pages 5746-5768, June.

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    Keywords

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    JEL classification:

    • L96 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Telecommunications
    • L51 - Industrial Organization - - Regulation and Industrial Policy - - - Economics of Regulation
    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development

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