Bill-and-Keep vs. Cost-Based Access Pricing Revisited

Ulrich Berger
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Ulrich Berger: Wirtschaftsuniversität Wien

Industrial Organization from EconWPA

Abstract: We study network competition with two-part tariffs and termination-based price discrimination in the presence of call externalities. We show that both the collusive and the welfare maximizing access charges fall below marginal cost. Moreover, bill-and-keep arrangements are welfare improving compared with cost-based access pricing.

Keywords: Access Charge; Bill-and-Keep; Call Externality; Interconnection; Telecommunications (search for similar items in EconPapers)
JEL-codes: L41 L96 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-fin
Date: 2004-08-06
Note: Type of Document - pdf; pages: 10
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Persistent link: http://EconPapers.repec.org/RePEc:wpa:wuwpio:0408002

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