The diffusion of information technology and the demand for telecommunication services

Cristiano Antonelli

Telecommunications Policy, 1989, vol. 13, issue 3, 255-264

Abstract: A radical change in the economic analysis and empirical estimates of demand for telecommunications services is called for. The focus on the role of price and revenue elasticities has been shown to have limitations and demand is now thought to be stimulated by the continuous increase in user-value, associated with the relevant dynamic externalities and learning processes. This paper recalls the issues relating to externalities and interdependent preferences, explores technological change in telecommunications and its diffusion, and examines the determinants of the diffusion of information technology. The conclusions present elements of a dynamic model for telecommunications services where the diffusion of new IT plays a new role, and then elaborate some policy implications.

Date: 1989
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