Three-Part Tariffs and Short-Run Rationality in the Local Fixed Telephone Consumption: Empirical Evidence from Medellín
In this paper we are interested in investigating the effects of the threepart tariffs system on consumers’ behavior in the local fixed telephone service provided by the incumbent Telecommunications Company une in Medellín, which was authorized by the Telecommunications Regulatory Commission (crt, for its Spanish name). In order to study consumer behavior and the effect of this tariff system we specify a sort of Engel Curve, which relates expenditure in fixed telephone service and expenditure in public utilities. Endogeneity problems could well arise from this specification, so the empirical strategy for studying households’ consumption is based on a panel data analysis by performing instrumental variables and gmm procedures. Our results supports the hypothesis that consumers surpass expected consumption levels and therefore the total payment for the service is greater than planned, showing a sort of short-run irrationality in consumption.
|Date of creation:||2010|
|Date of revision:|
|Contact details of provider:|| Web page: http://www.udea.edu.co/portal/page/portal/portal/A.InformacionInstitucional/H.UnidadesAcademicas/A.Facultades/CienciasEconomicas|
More information through EDIRC
|Order Information:|| Postal: Apartado Aéreo 1226, Medellín - Colombia|
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.:
- James Banks & Richard Blundell & Arthur Lewbel, 1997. "Quadratic Engel Curves And Consumer Demand," The Review of Economics and Statistics, MIT Press, vol. 79(4), pages 527-539, November.
- repec:bla:restud:v:77:y:2010:i:1:p:30-60 is not listed on IDEAS
- repec:cup:cbooks:9780521314008 is not listed on IDEAS
- Richard Blundell & Alan Duncan & Krishna Pendakur, 1998. "Semiparametric estimation and consumer demand," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 13(5), pages 435-461.
When requesting a correction, please mention this item's handle: RePEc:lde:grupom:058. 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: (Carlos Andrés Vasco Correa)
If references are entirely missing, you can add them using this form.