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Efficient contracts for government intervention in promoting next generation communications networks

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  • Briglauer, Wolfgang
  • Holzleitner, Christian

Abstract

Although the future socio-economic benefits of a new fibre-based ('next generation access', NGA) telecommunications infrastructure seem to be uncontroversial, a universal NGA coverage appears to be a rather unrealistic objective without government intervention. We contend, however, that the current contract practice of fixing ex ante targets for network expansion is inefficient given the uncertainty about future returns on NGA infrastructure-based services and the public authorities' incomplete information about the capital costs of the network provider. This paper puts forward to delegate the choice of the network expansion to the NGA provider.

Suggested Citation

  • Briglauer, Wolfgang & Holzleitner, Christian, 2014. "Efficient contracts for government intervention in promoting next generation communications networks," ZEW Discussion Papers 14-022, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
  • Handle: RePEc:zbw:zewdip:14022
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    File URL: https://www.econstor.eu/bitstream/10419/94352/1/781541115.pdf
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    References listed on IDEAS

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    1. Wolfgang Briglauer, 2014. "The impact of regulation and competition on the adoption of fiber-based broadband services: recent evidence from the European union member states," Journal of Regulatory Economics, Springer, vol. 46(1), pages 51-79, August.
    2. Eduardo Engel & Ronald Fischer & Alexander Galetovic, 2013. "The Basic Public Finance Of Public–Private Partnerships," Journal of the European Economic Association, European Economic Association, vol. 11(1), pages 83-111, February.
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    4. Given, Jock, 2010. "Take your partners: Public private interplay in Australian and New Zealand plans for next generation broadband," Telecommunications Policy, Elsevier, vol. 34(9), pages 540-549, October.
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    8. Jullien Bruno & Pouyet Jerome & Sand-Zantman Wilfried, 2010. "Public and Private Investments in Regulated Network Industries: Coordination and Competition Issues," Review of Network Economics, De Gruyter, vol. 9(4), pages 1-22, December.
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    Cited by:

    1. Briglauer Wolfgang & Frübing Stefan & Vogelsang Ingo, 2014. "The Impact of Alternative Public Policies on the Deployment of New Communications Infrastructure – A Survey," Review of Network Economics, De Gruyter, vol. 13(3), pages 227-270, September.
    2. Briglauer, Wolfgang & Gugler, Klaus, 2013. "The deployment and penetration of high-speed fiber networks and services: Why are EU member states lagging behind?," Telecommunications Policy, Elsevier, vol. 37(10), pages 819-835.

    More about this item

    Keywords

    contract theory; public utilities; next generation telecommunications networks; subsidies;

    JEL classification:

    • H20 - Public Economics - - Taxation, Subsidies, and Revenue - - - General
    • L43 - Industrial Organization - - Antitrust Issues and Policies - - - Legal Monopolies and Regulation or Deregulation
    • L44 - Industrial Organization - - Antitrust Issues and Policies - - - Antitrust Policy and Public Enterprise, Nonprofit Institutions, and Professional Organizations
    • L51 - Industrial Organization - - Regulation and Industrial Policy - - - Economics of Regulation
    • L52 - Industrial Organization - - Regulation and Industrial Policy - - - Industrial Policy; Sectoral Planning Methods
    • L96 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Telecommunications

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