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Estimating Telephone Demand with State Decennial Census Data from 1970-1990

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  • Garbacz, Christopher
  • Thompson, Herbert G

Abstract

A telephone demand model (logit) is estimated with pooled Decennial Census data (1970, 1980 and 1990) for the states. Previous studies using pooled FCC penetration data are suspect due to large standard errors in the sample. Since our model includes data across time this allows the inclusion of long distance price and increases the variation in the standard variables. Time-effect dummy variables control for unobserved shifts in the data. Given that these dummy variables may pick up some of the effect of the long distance price, as well as other unobserved effects, their estimated impact is relatively small. Robust model results lead to the conclusion that elasticities decline through time. Furthermore, while subsidized penetration is more effective for targeted than untargeted programs, the cost per year of adding a household to the network is very high in either case (for 1990 about $5368 for untargeted; and for targeted $191 in 1990 and $1581 in 1998). Copyright 2002 by Kluwer Academic Publishers

Suggested Citation

  • Garbacz, Christopher & Thompson, Herbert G, 2002. "Estimating Telephone Demand with State Decennial Census Data from 1970-1990," Journal of Regulatory Economics, Springer, vol. 21(3), pages 317-329, May.
  • Handle: RePEc:kap:regeco:v:21:y:2002:i:3:p:317-29
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    References listed on IDEAS

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    1. Li, Wei & Xu, Lixin Colin, 2002. "The Political Economy of Privatization and Competition: Cross-Country Evidence from the Telecommunications Sector," Journal of Comparative Economics, Elsevier, pages 439-462.
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    Cited by:

    1. De Clercq, Dirk & Danis, Wade M. & Dakhli, Mourad, 2010. "The moderating effect of institutional context on the relationship between associational activity and new business activity in emerging economies," International Business Review, Elsevier, vol. 19(1), pages 85-101, February.
    2. 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.
    3. Nicholas Bloom & Renata Lemos & Raffaella Sadun & John Van Reenen, 2015. "Does Management Matter in schools?," Economic Journal, Royal Economic Society, vol. 0(584), pages 647-674, May.
    4. Chiang, Eric P. & Hauge, Janice A., 2013. "The impact of non-neutral federal regulatory policy on competition," Telecommunications Policy, Elsevier, vol. 37(11), pages 1142-1149.
    5. Ackerberg, Daniel A. & DeRemer, David R. & Riordan, Michael H. & Rosston, Gregory L. & Wimmer, Bradley S., 2014. "Estimating the impact of low-income universal service programs," International Journal of Industrial Organization, Elsevier, vol. 37(C), pages 84-98.
    6. PĂ©rez Montes, Carlos, 2013. "Regulatory bias in the price structure of local telephone service," International Journal of Industrial Organization, Elsevier, vol. 31(5), pages 462-476.
    7. Eric P. Chiang & Janice A. Hauge, 2007. "Funding Universal Service: The Effect of Telecommunications Subsidy Programs on Competition and Retail Prices," Working Papers 07-08, NET Institute, revised Aug 2007.
    8. Danis, Wade M. & De Clercq, Dirk & Petricevic, Olga, 2011. "Are social networks more important for new business activity in emerging than developed economies? An empirical extension," International Business Review, Elsevier, vol. 20(4), pages 394-408, August.
    9. De Clercq, Dirk & Meuleman, Miguel & Wright, Mike, 2012. "A cross-country investigation of micro-angel investment activity: The roles of new business opportunities and institutions," International Business Review, Elsevier, vol. 21(2), pages 117-129.
    10. Holt, Lynne & Galligan, Mary, 2013. "Mapping the field: Retrospective of the federal universal service programs," Telecommunications Policy, Elsevier, vol. 37(9), pages 773-793.

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