Market Structure, Investment and Technical Efficiencies in Mobile Telecommunications

Jonathan Elliott, Georges Vivien Houngbonon, Marc Ivaldi and Paul T. Scott
Additional contact information
Georges Vivien Houngbonon: World Bank Group
Marc Ivaldi: TSE-R - Toulouse School of Economics - UT Capitole - Université Toulouse Capitole - UT - Université de Toulouse - EHESS - École des hautes études en sciences sociales - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement
Paul T. Scott: NYU - New York University [New York] - NYU - NYU System

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Abstract: We develop a model of competition in prices and infrastructure among mobile network operators. Although consolidation increases market power, it can lead to more efficient data transmission due to economies of scale, which we derive from physical principles. After estimating our model with French consumer and infrastructure data, equilibrium simulations reveal that while prices decrease with the number of firms, so do download speeds. Our framework also allows us to quantify the impact of spectrum allocation. The marginal social value of spectrum exceeds firms' willingness to pay in our model as well as observed prices in spectrum auctions.

Keywords: Market structure; Scale efficiency; Antitrust policy; Infrastructure; Endogenous; Quality; Queuing; Mobile telecommunications (search for similar items in EconPapers)
Date: 2024-12
New Economics Papers: this item is included in nep-com and nep-reg
Note: View the original document on HAL open archive server: https://hal.science/hal-04831225v1
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Citations: View citations in EconPapers (1)

Published in Journal of Political Economy, 2024, 132 (12), pp.1-16. ⟨10.1086/734132⟩

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Related works:
Working Paper: Market Structure, Investment and Technical Efficiencies in Mobile Telecommunications (2024)
Working Paper: Market Structure, Investment and Technical Efficiencies in Mobile Telecommunications (2021)
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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-04831225

DOI: 10.1086/734132

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