Prices and Outputs under Cable TV Reregulation
Cable television reregulation in October 1992 did succeed in constraining subscriber bills about 9% below trend by October 1994. Yet, the growth rate of basic cable television subscribership fell sharply during the period of rate reductions. Only when real rates began rising in the period following October 1994--after an explicit relaxation of controls--did reliable industry output measures return to the pre-regulation growth trend. These data suggest that rate regulation becomes substantially less viable as the complexity of the regulated good increases. Copyright 1997 by Kluwer Academic Publishers
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