How do mobile-voice operators compete? IVQR estimates

Corrado Andini and Ricardo Cabral

Applied Economics Letters, 2013, vol. 20, issue 1, 18-22

Abstract: This article proposes a novel procedure to test whether firms compete à la Cournot or perfectly collude when firms' conduct is allowed to be heterogeneous along the conditional distribution of price–cost margins. We apply the procedure to a panel of quarterly data for 177 mobile-voice operators in 45 countries from 1999:1 to 2004:2. Particularly, we find that the hypothesis of perfect collusion can be rejected even for very high-margin operators while the hypothesis that very low-margin operators compete à la Cournot cannot be rejected.

Date: 2013
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DOI: 10.1080/13504851.2012.669455

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