Telecom market liberalization and service performance outcomes of an incumbent monopoly

Alhassan G. Mumuni, Mushtaq Luqmani and Zahir A. Quraeshi

International Business Review, 2017, vol. 26, issue 2, 214-224

Abstract: Using data from a high-income, emerging market economy in the Middle East, this study examines changes in service performance outcomes of an incumbent monopoly during different periods in the phased liberalization of the country’s telecommunications market. The study draws on Structure-Conduct-Performance (SCP) theory and Social Exchange Theory (SET) to develop hypotheses about expected changes in four customer-based service performance outcomes—service quality perceptions, customer satisfaction, customer loyalty, and customer attitudes. These are tested using data collected in a longitudinal tracking study spanning different periods in the liberalization process. Results show that all four performance outcomes improved significantly during an early post-liberalization period when there was only one additional competitor in the market, but declined slightly during a later period when a second competitor entered the market. However, structural relationships among the outcomes themselves remained invariant across liberalization periods. Policy-making and theoretical implications of the results are outlined and discussed. Although the data come from a single industry in an emerging market economy, a particularly key implication is that while incumbent monopolies may initially harbor a preference for the comfort and ‘freedom’ that comes with being the only player in the market, under certain circumstances liberalization can actually benefit them through the impetus that it provides for their own service quality improvements.

Keywords: Market liberalization; Competitive intensity; Industry structure; Service quality; Customer satisfaction; Telecommunications market; Saudi Arabia; Incumbent monopoly (search for similar items in EconPapers)
Date: 2017
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0969593116300932
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:iburev:v:26:y:2017:i:2:p:214-224

Ordering information: This journal article can be ordered from
http://www.elsevier.com/wps/find/journaldescription.cws_home/133/bibliographic
http://www.elsevier. ... me/133/bibliographic

DOI: 10.1016/j.ibusrev.2016.06.008

Access Statistics for this article

International Business Review is currently edited by P. Ghauri

More articles in International Business Review from Elsevier
Bibliographic data for series maintained by Catherine Liu ().