Econometric Cost Structure Estimates for Cellular Telephony in the United States

David McKenzie and John P Small

Journal of Regulatory Economics, 1997, vol. 12, issue 2, 147-57

Abstract: This article estimates economies of scale for a sample of five cellular telephony firms in the United States. We reject constant returns to scale for all but the smallest firm studied; the remaining firms exhibit decreasing returns to scale. This finding suggests that scale economies cannot be used to justify the current regulated duopoly structure of United States cellular markets. Copyright 1997 by Kluwer Academic Publishers

Date: 1997
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