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Mobile and fixed substitution for telephone service in China

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  • Ward, Michael R.
  • Zheng, Shilin

Abstract

A panel of province by year data for China from 1998 to 2007 is used to estimate own- and cross-price elasticities for fixed and mobile telephone service. Identification is achieved through the use of measures of the level of competition and privatization of the industry. Moreover, using neighboring province values ensures instrumental variable exogeneity. Estimates suggest that fixed and mobile subscriptions are fairly strong substitutes. This provides evidence for the development of competition between these platforms.

Suggested Citation

  • Ward, Michael R. & Zheng, Shilin, 2012. "Mobile and fixed substitution for telephone service in China," Telecommunications Policy, Elsevier, vol. 36(4), pages 301-310.
    • Handle: RePEc:eee:telpol:v:36:y:2012:i:4:p:301-310
    DOI: 10.1016/j.telpol.2011.12.002
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    Cited by:

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    2. Tang, Chang & Xu, Yuanyuan & Hao, Yu & Wu, Haitao & Xue, Yan, 2021. "What is the role of telecommunications infrastructure construction in green technology innovation? A firm-level analysis for China," Energy Economics, Elsevier, vol. 103(C).
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    4. Yi Luo & Zhiwei Tang & Peiqi Fan, 2021. "Could Government Data Openness Enhance Urban Innovation Capability? An Evaluation Based on Multistage DID Method," Sustainability, MDPI, vol. 13(23), pages 1-16, December.
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    6. Ovando, Catalina & Olivera, Emmanuel, 2018. "Was household internet adoption driven by the reform? Evaluation of the 2013 telecommunication reform in Mexico," Telecommunications Policy, Elsevier, vol. 42(9), pages 700-714.
    7. Lukasz Grzybowski & Frank Verboven, 2016. "Substitution between fixed-line and mobile access: the role of complementarities," Journal of Regulatory Economics, Springer, vol. 49(2), pages 113-151, April.
    8. Parsons, Steve G. & Duffy-Deno, Kevin T., 2021. "Are telecommunications regulators correct in their beliefs that network size affects origination/termination?," Telecommunications Policy, Elsevier, vol. 45(2).
    9. Jinsoo Bae & Yun Jeong Choi & Jong-Hee Hahn, 2014. "Fixed and mobile broadband; Are they substitutes or complements?," Working papers 2014rwp-68, Yonsei University, Yonsei Economics Research Institute.
    10. Xia, Jun, 2017. "China’s telecommunications evolution, institutions, and policy issues on the eve of 5G: A two-decade retrospect and prospect," Telecommunications Policy, Elsevier, vol. 41(10), pages 931-947.
    11. Ezzat Riham Ahmed, 2017. "Fixed-Mobile Substitution in MENA Countries: The Future of Fixed-Line Markets," Review of Network Economics, De Gruyter, vol. 16(4), pages 387-417, December.
    12. Ward, Michael R. & Zheng, Shilin, 2016. "Mobile telecommunications service and economic growth: Evidence from China," Telecommunications Policy, Elsevier, vol. 40(2), pages 89-101.
    13. Shinohara, Sobee & Akematsu, Yuji & Morikawa, Hiroyuki & Tsuji, Masatsugu, 2013. "Current issues of the Japanese mobile phone market caused by smartphones," 24th European Regional ITS Conference, Florence 2013 88528, International Telecommunications Society (ITS).
    14. Barth, Anne-Kathrin & Heimeshoff, Ulrich, 2014. "What is the magnitude of fixed–mobile call substitution? Empirical evidence from 16 European countries," Telecommunications Policy, Elsevier, vol. 38(8), pages 771-782.
    15. Shinohara, Sobee & Morikawa, Hiroyuki & Tsuji, Masatsugu, 2015. "Competition or smartphones? Factors promote mobile broadband adoption in OECD countries," 2015 Regional ITS Conference, Los Angeles 2015 146349, International Telecommunications Society (ITS).
    16. Shinohara, Sobee & Morikawa, Hiroyuki & Tsuji, Masatsugu, 2016. "How Smartphones Transformed Market and Competition of Mobile Broadband in OECD Member Countries," 27th European Regional ITS Conference, Cambridge (UK) 2016 148704, International Telecommunications Society (ITS).
    17. Shinohara, Sobee & Morikawa, Hiroyuki & Tsuji, Masatsugu, 2014. "Empirical analysis of mobile broadband adoption in major six countries from the view of competition policy," 20th ITS Biennial Conference, Rio de Janeiro 2014: The Net and the Internet - Emerging Markets and Policies 106849, International Telecommunications Society (ITS).
    18. Ward, Michael R. & Zheng, Shilin, 2014. "Mobile telecommunications infrastructure and economic growth: Evidence from China," 25th European Regional ITS Conference, Brussels 2014 101405, International Telecommunications Society (ITS).
    19. Lim, Jinyang & Nam, Changi & Kim, Seongcheol & Rhee, Hongjai & Lee, Euehun & Lee, Hongkyu, 2012. "Forecasting 3G mobile subscription in China: A study based on stochastic frontier analysis and a Bass diffusion model," Telecommunications Policy, Elsevier, vol. 36(10), pages 858-871.

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