Evaluating the Impact of Price Caps - Evidence from the European Roam-Like-at-Home Regulation

Frank Verboven, Giulia Canzian, Gianluca Mazzarella, Louis Ranchail and Stefano Verzillo

No 16554, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: The roam-like-at-home regulation (RLAH) eliminated all mobile roaming surcharges to European consumers travelling within the European Economic Area (EEA). We measure the causal impact of the regulation on EEA roaming traffic, using the Rest of the World as a control group. We find large and heterogeneous effects on retail and wholesale traffic volumes and revenues. To evaluate the welfare effects of the regulation, we develop a framework that includes consumer surplus, retail and wholesale profits. The gains in consumer surplus are large, and mainly stem from data services. The consumer gains are proportionately larger in small, open economies and in countries with previously high roaming prices. Finally, total welfare increases considerably, because the consumer surplus gains far outweigh profit losses. As such, the removal of market power more than compensates for a distortion from a possible overconsumption at zero surcharges.

Keywords: price caps; international roaming; mobile telecom; market integration (search for similar items in EconPapers)
Date: 2021-09
References: Add references at CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
https://cepr.org/publications/DP16554 (application/pdf)
CEPR Discussion Papers are free to download for our researchers, subscribers and members. If you fall into one of these categories but have trouble downloading our papers, please contact us at subscribers@cepr.org

Related works:
Working Paper: Evaluating the Impact of Price Caps - Evidence from the European Roam-Like-at-Home Regulation (2021)
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:cpr:ceprdp:16554

Ordering information: This working paper can be ordered from
https://cepr.org/publications/DP16554

Access Statistics for this paper

More papers in CEPR Discussion Papers from C.E.P.R. Discussion Papers Centre for Economic Policy Research, 33 Great Sutton Street, London EC1V 0DX.
Bibliographic data for series maintained by ().