Endogenous Regulatory Delay and the Timing of Product Innovation
This paper endogenizes the interplay between innovation by a regulated firm and regulatory delay. When product innovation costs fall over time, an extra day of regulatory delay increases time to introduction by more than a day. In the signaling model, the firm therefore times its innovation to communicate its private information about the marginal cost of delay to the regulator. Successful signaling leads the regulator to reduce regulatory delay. The model places testable restrictions on the empirical relationship between innovation delay and regulatory delay. The model is consistent with data gathered from a large U.S. telecommunications provider.
|Date of creation:||06 Jun 2005|
|Date of revision:|
|Contact details of provider:|| Postal: One Shields Ave., Davis, CA 95616-8578|
Phone: (530) 752-0741
Fax: (530) 752-9382
Web page: http://www.econ.ucdavis.edu
More information through EDIRC
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.:
- Kreps, David M & Wilson, Robert, 1982.
Econometric Society, vol. 50(4), pages 863-94, July.
- Michael H. Riordan, 1992.
"Regulation and Preemptive Technology Adoption,"
RAND Journal of Economics,
The RAND Corporation, vol. 23(3), pages 334-349, Autumn.
- Yossef Spiegel & Simon Wilkie, 1996. "Investment in a New Technology as a Signal of Firm Value Under Regulatory Opportunism," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 5(2), pages 251-276, 06.
- Spiegel, Y. & Spulber, D.F., 1993.
"Capital Structure with Countervailing Incentives,"
93, Bell Communications - Economic Research Group.
- Gruber, Harald & Verboven, Frank, 2000.
"The Evolution of Markets Under Entry and Standards Regulation - The Case of Global Mobile Telecommunications,"
CEPR Discussion Papers
2440, C.E.P.R. Discussion Papers.
- Gruber, Harald & Verboven, Frank, 2001. "The evolution of markets under entry and standards regulation -- the case of global mobile telecommunications," International Journal of Industrial Organization, Elsevier, vol. 19(7), pages 1189-1212, July.
- GRUBER, Harald & VERBOVEN, Frank, . "The evolution of markets under entry and standards regulation - The case of a global mobile telecommunications," Working Papers 1999038, University of Antwerp, Faculty of Applied Economics.
- Sweeney, George, 1981. "Adoption of Cost-Saving Innovations by a Regulated Firm," American Economic Review, American Economic Association, vol. 71(3), pages 437-47, June.
- Prieger, James E, 2001.
"Telecommunications Regulation and New Services: A Case Study at the State Level,"
Journal of Regulatory Economics,
Springer, vol. 20(3), pages 285-305, November.
- James E. Prieger, . "Telecommunications Regulation and New Services: a Case Study at the State Level," Department of Economics 00-11, California Davis - Department of Economics.
- James E. Prieger, 2003. "Telecommunications Regulation and New Services: a Case Study at the State Level," Working Papers 011, University of California, Davis, Department of Economics.
- Prager, Robin A, 1989. "The Effects of Regulatory Policies on the Cost of Debt for Electric Utilities: An Empirical Investigation," The Journal of Business, University of Chicago Press, vol. 62(1), pages 33-53, January.
- Lyon, Thomas P & Huang, Haizou, 1995. "Asymmetric Regulation and Incentives for Innovation," Industrial and Corporate Change, Oxford University Press, vol. 4(4), pages 769-76.
- James Prieger, 2002. "A model for regulated product innovation and introduction with application to telecommunications," Applied Economics Letters, Taylor & Francis Journals, vol. 9(10), pages 625-629.
- James E. Prieger, 2002.
"Regulation, Innovation, and the Introduction of New Telecommunications Services,"
The Review of Economics and Statistics,
MIT Press, vol. 84(4), pages 704-715, November.
- James E. Prieger, 2003. "Regulation, Innovation, and the introduction of new telecommunications services," Working Papers 08, University of California, Davis, Department of Economics.
- James E. Prieger, . "Regulation, Innovation, and the introduction of new telecommunications services," Department of Economics 00-08, California Davis - Department of Economics.
- Donald, Stephen G & Sappington, David E M, 1997. "Choosing among Regulatory Options in the United States Telecommunications Industry," Journal of Regulatory Economics, Springer, vol. 12(3), pages 227-43, November.
- Roycroft, Trevor R., 1999. "Alternative regulation and the efficiency of local exchange carriers: evidence from the Ameritech states," Telecommunications Policy, Elsevier, vol. 23(6), pages 469-480, September.
- Milgrom, Paul & Shannon, Chris, 1994.
"Monotone Comparative Statics,"
Econometric Society, vol. 62(1), pages 157-80, January.
- Hazlett Thomas W. & Ford George S., 2001. "The Fallacy of Regulatory Symmetry: An Economic Analysis of the 'Level Playing Field' in Cable TV Franchising Statutes," Business and Politics, De Gruyter, vol. 3(1), pages 1-27, April.
- Cabral, Luis M B & Riordan, Michael H, 1989. "Incentives for Cost Reduction under Price Cap Regulation," Journal of Regulatory Economics, Springer, vol. 1(2), pages 93-102, June.
- Ando, Amy Whritenour, 1999. "Waiting to Be Protected under the Endangered Species Act: The Political Economy of Regulatory Delay," Journal of Law and Economics, University of Chicago Press, vol. 42(1), pages 29-60, April.
- Mailath, George J, 1987. "Incentive Compatibility in Signaling Games with a Continuum of Types," Econometrica, Econometric Society, vol. 55(6), pages 1349-65, November.
- Jerry A. Hausman, 1997. "Valuing the Effect of Regulation on New Services in Telecommunications," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 28(1997 Micr), pages 1-54.
When requesting a correction, please mention this item's handle: RePEc:cda:wpaper:05-4. 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: (Scott Dyer)
If references are entirely missing, you can add them using this form.