Strength of investor protection and competition in ICT industry: A focus on internet and telephony markets in Asian countries

Ekaphak Amornmekin () and Komsan Suriya ()
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Ekaphak Amornmekin: Chiang Mai University

The Empirical Econometrics and Quantitative Economics Letters, 2013, vol. 2, issue 2, 97 – 100

Abstract: Investor protection is controversial in ICT industry such that the high investor protection may harm the industry, prevent new comers to enter into the market and induce collusions among dominant firms. This study provides another evidence of the relationship between strength of investor protection and competition in ICT industry. It uses OLS and Tobit to analyze the data from 144 countries. The findings reveal that the higher investor protection will induce higher competition. It means that potential investors prefer to enter into a market where they are well protected. Therefore, the number and quality of investors in these markets are high. They tend to compete rather than collude with other firms in the same market. However, this relationship is weakened in Asian countries. It means that even though the investor protection is good but the Asian markets are still risky by other uncontrollable factors such as politics. Therefore, quality investors may hesitate to enter into these markets and consequently the competition is not so high.

Keywords: ICT industry; Investor protection; Competition; Internet; Telephony (search for similar items in EconPapers)
Date: 2013
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