L'introduction de Free sur le marché des mobiles: essai d'analyse coûts-bénéfices

Pierre-Alexandre Kopp and Rémy Prud’homme

Revue d'économie politique, 2014, vol. 124, issue 3, 409-436

Abstract: The competition authority (ARCEP) authorized in 2011 the introduction of a fourth mobile operator (Free) alongside Orange, SFR and Bouygues. More competitors was expected to mean more competition, which was supposed to improve the efficiency of the sector. This choice was questioned by Deffains [2012] who showed that the introduction of Free would entail the destruction of 50.000 jobs. Conversely Thesmar and Landier [2012] expected from that measure the net creation of 16.000 to 30.000 jobs. These studies were focussed on the effect on employment. Here, we conduct a cost-benefit study that takes into account all the consequences of this measure to consumers, businesses and public finance. The arrival of Free has resulted in an annual increase of the consumer surplus of approximately ? 1.2 billion. This gain is offset by a loss of a slightly higher amount for producers. But it is accompanied by a loss of about ? 0.4 billion for public finance. In the end, the welfare impact of this decision is regrettable. The paper also discusses the reasons for which the benefits of competition were unlikely to materialize in the mobile phone sector.

Keywords: cost benefit analysis; competition policy (search for similar items in EconPapers)
Date: 2014
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