Using 'Bill and Keep' Interconnect Arrangements to Soften Network Competiti on
Joshua Gans () and
Stephen King ()
No 739, Department of Economics - Working Papers Series from The University of Melbourne
This paper demonstrates that low (below marginal cost) interconnect or access charges can be used to sustain high subscription prices in an environment of network competition with two-part tariffs and price discrimination. This result stands in contrast to other results in the literature suggesting that high interconnect charges can play a collusive role.
Keywords: MONOPOLIES; TELECOMMUNICATIONS; COMPETITION (search for similar items in EconPapers)
JEL-codes: L41 L96 (search for similar items in EconPapers)
Pages: 12 pages
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Journal Article: Using 'bill and keep' interconnect arrangements to soften network competition (2001)
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Persistent link: https://EconPapers.repec.org/RePEc:mlb:wpaper:739
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