Preying for Monopoly? The Case of Southern Bell Telephone Company, 1894-1912
Focusing on the Southern Bell Telephone Company, the authors propose a modified version of the predation hypothesis to explain Bell's 'natural' monopoly over local telephone service. Southern Bell effectively eliminated competition through a strategy of pricing below cost in response to entry, which deprived competitors of the cash flow required for expansion even if it failed to induce exit; investing in toll lines ahead of demand, isolating independent companies in smaller towns and rural areas, and forcing them to consolidate on favorable terms; and influencing local regulatory policy in larger cities to weaken rivals and ultimately to institutionalize the Bell monopoly. Copyright 1994 by University of Chicago Press.
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Arthur, W Brian, 1989. "Competing Technologies, Increasing Returns, and Lock-In by Historical Events," Economic Journal, Royal Economic Society, vol. 99(394), pages 116-131, March.
When requesting a correction, please mention this item's handle: RePEc:ucp:jpolec:v:102:y:1994:i:1:p:103-26. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Journals Division)
If references are entirely missing, you can add them using this form.