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Price wars in a highly concentrated industry: Mobile communication voice services

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  • John Jairo García Rendón

    ()

  • Diego F. Linares

Abstract

This work focuses on the main variables that explain the prices of the voice services established by mobile service providers in Colombia. This will be done by analyzing different variables that characterize this sector, like, historical prices stablished by all operators, all the investments made in network development, market sharing and all the existing regulatory measures. We develop a model for data panels in the period between 2005 and 2011, which makes evident the existing interdependence amongst the different companies when setting rates. It is also evident the leadership of one of the competitors and the existing price war between providers.

Suggested Citation

  • John Jairo García Rendón & Diego F. Linares, 2018. "Price wars in a highly concentrated industry: Mobile communication voice services," Documentos de Trabajo CIEF 016449, Universidad EAFIT.
  • Handle: RePEc:col:000122:016449
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    File URL: http://hdl.handle.net/10784/12578
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    References listed on IDEAS

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    1. Gruber, Harald, 1999. "An investment view of mobile telecommunications in the European Union," Telecommunications Policy, Elsevier, vol. 23(7-8), pages 521-538, August.
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    9. Rotemberg, Julio J & Saloner, Garth, 1986. "A Supergame-Theoretic Model of Price Wars during Booms," American Economic Review, American Economic Association, vol. 76(3), pages 390-407, June.
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    More about this item

    Keywords

    Telecommunications; price wars; Investment; Regulation; Colombia;

    JEL classification:

    • D43 - Microeconomics - - Market Structure, Pricing, and Design - - - Oligopoly and Other Forms of Market Imperfection
    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models

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