Facilities Competition and Local Network Investment: Theory, Evidence and Policy Implications

Glenn Woroch ()

Industrial and Corporate Change, 1998, vol. 7, issue 4, 601-14

Abstract: A new approach has emerged in the United States and elsewhere in the world for promoting investment in local communications networks. Competition, especially facilities-based entry, has become a principal means to encourage the efficient amount and timing of investment in local exchange infrastructure and adoption of advanced technologies. Despite the popularity of open entry policies, the logic underlying these policies lacks convincing evidence. Nevertheless, preliminary and incidental studies suggest that facilities-based entry stimulates investment by both incumbents and entrants. The message for policymakers is, first, to remove artificial restrictions on facilities-based entry and on incumbent investment, both as a response to competition and in advance of entry; and, second, to take account of the possibility of a virtuous cycle of investment deriving from incumbent-entrant interaction. These measures promise to supplement the ordinary benefits of facilities competition that will aid in building the next generation advanced communications network. Copyright 1998 by Oxford University Press.

Date: 1998
References: Add references at CitEc
Citations: View citations in EconPapers (5)

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

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:oup:indcch:v:7:y:1998:i:4:p:601-14

Ordering information: This journal article can be ordered from
https://academic.oup.com/journals

Access Statistics for this article

Industrial and Corporate Change is currently edited by Josef Chytry

More articles in Industrial and Corporate Change from Oxford University Press and the Associazione ICC Oxford University Press, Great Clarendon Street, Oxford OX2 6DP, UK.
Bibliographic data for series maintained by Oxford University Press ().