Competition vs. Regulation in Mobile Telecommunications
This paper questions whether competition can replace sector-specific regulation of mobile telecommunications. We show that the monopolistic outcome prevails independently of market concentration when access prices are determined in bilateral negotiations. A light-handed regulatory policy can induce effective competition. Call prices are close to the marginal cost if the networks are sufficiently close substitutes. Neither demand nor cost information is required. A unique and symmetric call price equilibrium exists under symmetric access prices, provided that call demand is sufficiently inelastic. Existence encompasses the case of many networks and high network substitutability.
|Date of creation:||20 Dec 2006|
|Date of revision:|
|Contact details of provider:|| Postal: Research Institute of Industrial Economics, Box 55665, SE-102 15 Stockholm, Sweden|
Phone: +46 8 665 4500
Fax: +46 8 665 4599
Web page: http://www.ifn.se/
More information through EDIRC
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.:
- Bouckaert, Jan & Verboven, Frank, 2003.
"Price Squeezes in a Regulatory Environment,"
CEPR Discussion Papers
3824, C.E.P.R. Discussion Papers.
- Doh-Shin Jeon, 2005. "A simple access pricing rule to achieve the Ramsey outcome for interconnected networks," Economics Working Papers 808, Department of Economics and Business, Universitat Pompeu Fabra, revised Sep 2005.
- Wouter Dessein, 2000.
"Network Competition in Nonlinear Pricing,"
CIG Working Papers
FS IV 00-22, Wissenschaftszentrum Berlin (WZB), Research Unit: Competition and Innovation (CIG).
- Mark Armstrong & David Sappington, 2005.
"Regulation, Competition and Liberalization,"
0505011, EconWPA, revised 07 Oct 2005.
- Ingo Vogelsang, 2006. "Access and Interconnection Pricing Issues in Telecommunications," CESifo DICE Report, Ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 4(3), pages 3-9, October.
- Horn, H. & Wolinsky, A., 1988.
"Bilateral Monopolies And Incentives For Merger,"
410, Stockholm - International Economic Studies.
- Doh Shin Jeon & Jean Jacques Laffont & Jean Tirole, 2001.
"On the receiver pays principle,"
Economics Working Papers
561, Department of Economics and Business, Universitat Pompeu Fabra.
- Doh-Shin Jeon & Sjaak Hurkens, 2007.
"A Retail Benchmarking Approach to Eficient Two-Way Access Pricing,"
UFAE and IAE Working Papers
717.07, Unitat de Fonaments de l'Anàlisi Econòmica (UAB) and Institut d'Anàlisi Econòmica (CSIC).
- Doh-Shin Jeon & Sjaak Hurkens, 2007. "A Retail Benchmarking Approach to Efficient Two-Way Access Pricing," Working Papers 324, Barcelona Graduate School of Economics.
- Doh-Shin Jeon & Sjaak Hurkens, 2007. "A retail benchmarking approach to efficient two-way access pricing," Economics Working Papers 1055, Department of Economics and Business, Universitat Pompeu Fabra.
- Armstrong, Mark, 1998. "Network Interconnection in Telecommunications," Economic Journal, Royal Economic Society, vol. 108(448), pages 545-64, May.
- Tommaso M. Valletti & Carlo Cambini, 2005.
"Investments and Network Competition,"
RAND Journal of Economics,
The RAND Corporation, vol. 36(2), pages 446-468, Summer.
- Röller, Lars-Hendrik & Waverman, Leonard, 2000.
"Telecommunications Infrastructure And Economic Development: A Simultaneous Approach,"
CEPR Discussion Papers
2399, C.E.P.R. Discussion Papers.
- Lars-Hendrik Roller & Leonard Waverman, 2001. "Telecommunications Infrastructure and Economic Development: A Simultaneous Approach," American Economic Review, American Economic Association, vol. 91(4), pages 909-923, September.
- Lars-Hendrik Röller & Leonard Waverman, 1996. "Telecommunications Infrastructure and Economic Development: A Simultaneous Approach," CIG Working Papers FS IV 96-16, Wissenschaftszentrum Berlin (WZB), Research Unit: Competition and Innovation (CIG).
- Joan Calzada & Tommaso M. Valletti, 2008.
"Network Competition and Entry Deterrence,"
Royal Economic Society, vol. 118(531), pages 1223-1244, 08.
- Wright, Julian, 2002. "Access Pricing under Competition: An Application to Cellular Networks," Journal of Industrial Economics, Wiley Blackwell, vol. 50(3), pages 289-315, September.
- Gans, Joshua S. & King, Stephen P., 2001.
"Using 'bill and keep' interconnect arrangements to soften network competition,"
Elsevier, vol. 71(3), pages 413-420, June.
- Gans, J.S. & King, S.P., 2000. "Using 'Bill and Keep' Interconnect Arrangements to Soften Network Competiti on," Department of Economics - Working Papers Series 739, The University of Melbourne.
- Jonas Björnerstedt & Johan Stennek, 2001.
CIG Working Papers
FS IV 01-08, Wissenschaftszentrum Berlin (WZB), Research Unit: Competition and Innovation (CIG).
- Oecd, 2006. "Telecommunication Regulatory Institutional Structures and Responsibilities," OECD Digital Economy Papers 105, OECD Publishing.
- Michael Carter & Julian Wright, 2003. "Asymmetric Network Interconnection," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 22(1), pages 27-46, February.
- Berger, Ulrich, 2005. "Bill-and-keep vs. cost-based access pricing revisited," Economics Letters, Elsevier, vol. 86(1), pages 107-112, January.
- Armstrong, Mark, 2004. "Network interconnection with asymmetric networks and heterogeneous calling patterns," Information Economics and Policy, Elsevier, vol. 16(3), pages 375-390, September.
- Armstrong, M., 1996. "Network interconnection," Discussion Paper Series In Economics And Econometrics 9625, Economics Division, School of Social Sciences, University of Southampton.
- Davidson, Carl, 1988. "Multiunit Bargaining in Oligopolistic Industries," Journal of Labor Economics, University of Chicago Press, vol. 6(3), pages 397-422, July.
- Bjornerstedt, Jonas & Stennek, Johan, 2007. "Bilateral oligopoly -- The efficiency of intermediate goods markets," International Journal of Industrial Organization, Elsevier, vol. 25(5), pages 884-907, October.
When requesting a correction, please mention this item's handle: RePEc:hhs:iuiwop:0685. 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: (Elisabeth Gustafsson)
If references are entirely missing, you can add them using this form.