Competition vs. Regulation in Mobile Telecommunications

Johan Stennek and Tangerås, Thomas P.
Authors registered in the RePEc Author Service: Thomas Tangerås ()

No 6073, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: This paper questions whether competition can replace sector-specific regulation of mobile telecommunications. We show that the monopolistic outcome prevails independently of market concentration when access prices are determined in bilateral negotiations. A light-handed regulatory policy can induce effective competition. Call prices are close to the marginal cost if the networks are sufficiently close substitutes. Neither demand nor cost information is required. A unique and symmetric call price equilibrium exists under symmetric access prices, provided that call demand is sufficiently inelastic. Existence encompasses the case of many networks and high network substitutability.

Keywords: Access price competition; Entry; Network competition; Network substitutability; Regulation; Two-way access (search for similar items in EconPapers)
JEL-codes: L51 L96 (search for similar items in EconPapers)
Date: 2007-02
New Economics Papers: this item is included in nep-com, nep-cse, nep-mic, nep-net and nep-reg
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Related works:
Working Paper: Competition vs. Regulation in Mobile Telecommunications (2008)
Working Paper: Competition vs. Regulation in Mobile Telecommunications (2006)
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