IDEAS home Printed from https://ideas.repec.org/a/kap/atlecj/v30y2002i2p186-190.html
   My bibliography  Save this article

On access pricing with network externalities

Author

Listed:
  • Demetrius Yannelis

Abstract

It has been argued that access charges may be set optimally by applying the Efficient Component Pricing Rule (ECPR). The paper analyzes the optimality properties of the ECPR in the presence of network externalities in the telecommunications sector. It is assumed that network externalities in the fixed telephony, which is operated by an incumbent monopoly, may arise from the increase in the number of subscribers of a mobile carrier that seeks interconnection to the fixed network. It is shown that the optimality properties of the ECPR that may exist under some restrictive assumptions, do not hold in the presence of network externalities. Specifically, the ECPR may take into account the social opportunity cost with the entry of the competitor, but it fails to incorporate the social benefit accrued to consumers of the fixed telephony when network externalities are present. Copyright International Atlantic Economic Society 2002

Suggested Citation

  • Demetrius Yannelis, 2002. "On access pricing with network externalities," Atlantic Economic Journal, Springer;International Atlantic Economic Society, vol. 30(2), pages 186-190, June.
    • Handle: RePEc:kap:atlecj:v:30:y:2002:i:2:p:186-190
    DOI: 10.1007/BF02299161
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1007/BF02299161
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1007/BF02299161?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Laffont, Jean-Jacques & Tirole, Jean, 1994. "Access pricing and competition," European Economic Review, Elsevier, vol. 38(9), pages 1673-1710, December.
    2. Armstrong, Mark & Doyle, Chris & Vickers, John, 1996. "The Access Pricing Problem: A Synthesis," Journal of Industrial Economics, Wiley Blackwell, vol. 44(2), pages 131-150, June.
    3. Lyn Squire, 1973. "Some Aspects of Optimal Pricing for Telecommunications," Bell Journal of Economics, The RAND Corporation, vol. 4(2), pages 515-525, Autumn.
    4. Jeffrey Rohlfs, 1974. "A Theory of Interdependent Demand for a Communications Service," Bell Journal of Economics, The RAND Corporation, vol. 5(1), pages 16-37, Spring.
    5. J. Gregory Sidak & William Baumol, 1994. "Toward Competition in Local Telephony," Books, American Enterprise Institute, number 52984, September.
    6. Economides, Nicholas, 1996. "Network externalities, complementarities, and invitations to enter," European Journal of Political Economy, Elsevier, vol. 12(2), pages 211-233, September.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Richard Gretz, 2010. "Console Price and Software Availability in the Home Video Game Industry," Atlantic Economic Journal, Springer;International Atlantic Economic Society, vol. 38(1), pages 81-94, March.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Kotakorpi, Kaisa, 2002. "Access Pricing and Competition in Telecommunications," Discussion Papers 283, VATT Institute for Economic Research.
    2. Nicholas Economides, 1997. "The Economics of Networks," Brazilian Electronic Journal of Economics, Department of Economics, Universidade Federal de Pernambuco, vol. 1(0), December.
    3. Okada, Yosuke & Hatta, Keiko, 1999. "The Interdependent Telecommunications Demand and Efficient Price Structure," Journal of the Japanese and International Economies, Elsevier, vol. 13(4), pages 311-335, December.
    4. isamu matsukawa, 2005. "Congestion pricing of inputs in vertically related markets," Industrial Organization 0506012, University Library of Munich, Germany.
    5. Valletti, Tommaso, 1998. "Two-part access pricing and imperfect competition," Information Economics and Policy, Elsevier, vol. 10(3), pages 305-323, September.
    6. McHardy, Jolian & Reynolds, Michael & Trotter, Stephen, 2013. "Network interconnectivity with competition and regulation," Transportation Research Part A: Policy and Practice, Elsevier, vol. 47(C), pages 97-110.
    7. Armstrong, Mark & Sappington, David E.M., 2007. "Recent Developments in the Theory of Regulation," Handbook of Industrial Organization, in: Mark Armstrong & Robert Porter (ed.), Handbook of Industrial Organization, edition 1, volume 3, chapter 27, pages 1557-1700, Elsevier.
    8. Lewis, Tracy R. & Sappington, David E. M., 1999. "Access pricing with unregulated downstream competition," Information Economics and Policy, Elsevier, vol. 11(1), pages 73-100, March.
    9. Vogelsang, Ingo, 2000. "Regulation of Access to the Telecommunications Network of New Zealand: A Review of the Literature," Working Paper Series 3931, Victoria University of Wellington, The New Zealand Institute for the Study of Competition and Regulation.
    10. Stephen P. King, 1997. "National Competition Policy," The Economic Record, The Economic Society of Australia, vol. 73(222), pages 270-284, September.
    11. Carlo Cambini & Piercarlo Ravazzi & Tommaso Valletti, 2000. "La tariffazione dell'accesso nelle telecomunicazioni: principi economici e interventi regolatori in alcuni paesi industrializzati," ICER Working Papers 10-2000, ICER - International Centre for Economic Research.
    12. Ingo Vogelsang, 2003. "Price Regulation of Access to Telecommunications Networks," Journal of Economic Literature, American Economic Association, vol. 41(3), pages 830-862, September.
    13. Riechmann, Christoph, 2000. "Strategic pricing of grid access under partial price-caps -- electricity distribution in England and Wales," Energy Economics, Elsevier, vol. 22(2), pages 187-207, April.
    14. Ku, Hyeon-Mo & Kim, Jae-Cheol, 1998. "Non-discriminatory access pricing for multiple entrants," International Review of Economics & Finance, Elsevier, vol. 7(2), pages 173-183.
    15. Xie, Li & Kong, Chun, 2023. "The social welfare effect of electricity user connection price policy reform," Applied Energy, Elsevier, vol. 346(C).
    16. Barman, Hemanta & Dutta, Mrinal Kanti & Nath, Hiranya K., 2018. "The telecommunications divide among Indian states," Telecommunications Policy, Elsevier, vol. 42(7), pages 530-551.
    17. López, Rafael & Valarezo, Ángel & Pérez-Amaral, Teodosio, 2023. "Unleashing the potential of online learning in Spain: An econometric analysis," Telecommunications Policy, Elsevier, vol. 47(6).
    18. Tina Kao & Flavio Menezes & John Quiggin, 2014. "Optimal access regulation with downstream competition," Journal of Regulatory Economics, Springer, vol. 45(1), pages 75-93, February.
    19. Dejan Trifunović & Đorđe Mitrović, 2016. "Price Discrimination, Entry, And Switching Costs In Network Competition," Economic Annals, Faculty of Economics and Business, University of Belgrade, vol. 61(209), pages 129-160, April - J.
    20. Cremer, Helmuth & Roy, Bernard & Toledano, Joëlle & de Villemeur, Étienne, 2003. "Access Pricing and Imperfect Competition," IDEI Working Papers 217, Institut d'Économie Industrielle (IDEI), Toulouse.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:kap:atlecj:v:30:y:2002:i:2:p:186-190. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.