Free Internet Access and Regulation

Bipasa Datta and Huw Dixon

Discussion Papers from Department of Economics, University of York

Abstract: In this paper we consider the impact of the regulation of telephony on Haan's [2001] analysis of the economics of free internet access. Haan considers an unregulated market, and finds that free internet access is compatible with an efficient outcome and avoids the double marginalization problem. We find that if there is binding price cap regulation, then free internet access is never efficient: ISP access charges will be strictly positive. This suggests that either price-cap regulation is non-binding in the ISP access market, or that some other explanation is required.

JEL-codes: L12 L22 L42 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-afr, nep-com, nep-ind, nep-mic and nep-net
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