Interconnection pricing: An analysis of the efficient component pricing rule

Robert Albon

Telecommunications Policy, 1994, vol. 18, issue 5, 414-420

Abstract: A potential entrant wishes to offer a long-distance service by establishing its own long-distance 'upstream' facility and using the incumbent's local ('downstream') network to provide reticulation of its calls, and the issue is to determine an efficient interconnection price for the entrant's use of that facility. William Baumol has proposed the 'efficient component pricing rule' (ECPR) which is developed using a simplified railroad example. The efficient component price includes both incremental costs and overheads. Analysis of efficient interconnection pricing revolves around the definition of incremental and 'overhead' costs, and it is concluded that the ECPR does not provide an efficient basis for interconnection pricing.

Date: 1994
References: Add references at CitEc
Citations:

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/0308596194900566
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:telpol:v:18:y:1994:i:5:p:414-420

Ordering information: This journal article can be ordered from
http://www.elsevier.com/wps/find/journaldescription.cws_home/30471/bibliographic
http://www.elsevier. ... /30471/bibliographic

Access Statistics for this article

Telecommunications Policy is currently edited by Erik Bohlin

More articles in Telecommunications Policy from Elsevier
Bibliographic data for series maintained by Catherine Liu ().