Abstract

http://ssrn.com/abstract=1147677
 
 

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Competition vs. Regulation in Mobile Telecommunications


Johan Stennek


Research Institute of Industrial Economics (IFN); Centre for Economic Policy Research (CEPR)

Thomas Tangerås


Research Institute of Industrial Economics (IFN)

October 20, 2008

NET Institute Working Paper No. 08-09

Abstract:     
This paper questions whether competition can replace sector-specific regulation of mobile telecommunications. We show that the monopolistic outcome may prevail independently of market concentration when access prices are determined in bilateral negotiations. A lighthanded 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.

Number of Pages in PDF File: 46

Keywords: network competition, two-way access, mobile termination

JEL Classification: L12, L14, L51, L96

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Date posted: June 18, 2008 ; Last revised: December 25, 2013

Suggested Citation

Stennek, Johan and Tangerås, Thomas, Competition vs. Regulation in Mobile Telecommunications (October 20, 2008). NET Institute Working Paper No. 08-09 . Available at SSRN: http://ssrn.com/abstract=1147677 or http://dx.doi.org/10.2139/ssrn.1147677

Contact Information

Johan Stennek
Research Institute of Industrial Economics (IFN) ( email )
P.O. Box 5501
S-114 85 Stockholm
Sweden
+46 8 665 4536 (Phone)
+46 8 665 4599 (Fax)
Centre for Economic Policy Research (CEPR)
77 Bastwick Street
London, EC1V 3PZ
United Kingdom
Thomas Tangerås (Contact Author)
Research Institute of Industrial Economics (IFN) ( email )
Box 55665
Grevgatan 34, 2nd floor
Stockholm, SE-102 15
Sweden
HOME PAGE: http://www.ifn.se/thomast
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