Product Market Competition and Lobbying Coordination in the U.S. Mobile Telecommunications Industry

Astrid Jung () and Tomaso Duso ()
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Tomaso Duso: https://econ.univie.ac.at

Vienna Economics Papers from University of Vienna, Department of Economics

Abstract: This paper empirically investigates market behavior and firms' lobbying in a unified structural setup. In a sequential game, where firms lobby for regulation before they compete in the product market, we derive a destable measure of lobbying coordination. Applying the setting to the early U.S. cellular services industry, we find that lobbying expenditures, as measured by campaign contributions, and market conduct were consistent with a one-shot Nash equilibrium and that price caps were binding on average. Furthermore, campaign contributions from cellular firms effectively lowered the burden of the price caps and reduced production costs.

JEL-codes: C31 D72 L13 L51 L96 (search for similar items in EconPapers)
Date: 2004-03
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