Abstract

http://ssrn.com/abstract=333460
 
 

Citations (3)



 
 

Footnotes (733)



 


 



Access to Networks: Economic and Constitutional Connections


Daniel F. Spulber


Northwestern University - Kellogg School of Management

Christopher S. Yoo


University of Pennsylvania Law School; University of Pennsylvania - Annenberg School for Communication; University of Pennsylvania - School of Engineering and Applied Science


Cornell Law Review, Vol. 88, 2003
TPRC 2003
Vanderbilt Law and Economics Research Paper No. 02-08
Vanderbilt Public Law Research Paper No. 02-07
Northwestern Law & Econ Research Paper No. 03-05
Northwestern Public Law Research Paper No. 03-06

Abstract:     
A fundamental transformation is taking place in the basic approach to regulating network industries. Policy makers are in the process of abandoning their century-old commitment to rate regulation in favor of a new regulatory approach known as access regulation. Rather than controlling the price of outputs, the new approach focuses on compelling access to and mandating the price of inputs. Unfortunately, this shift in regulatory policy has not been met with an accompanying shift in the manner in which regulatory authorities regulate prices. Specifically, policy makers have continued to base rates on either historical or replacement cost.

We argue that courts and policy makers have largely ignored the fact that this fundamental shift in regulatory approach demands an equally fundamental shift in the approach to setting prices. Economic theory suggests that regulatory authorities should base access prices on market prices. In addition, because compelled access to most telecommunications networks requires that competitors be permitted to place equipment on the network owner's property, access requirements constitute physical takings for which market-based compensation must be paid. Although the unavailability of market-based determinants once justified basing prices on some measure of cost, the shift in regulatory policy (especially when combined with the emergence of direct, facilities-based competition made possible by technological convergence) has caused the justifications for refusing to set rates on the basis of market prices to fall away.

We then use these insights to analyze access pricing with respect to three emerging regulatory issues: (1) access to unbundled network elements mandated by the Telecommunications Act of 1996, (2) the access to utility poles compelled by the 19996 amendments to the Pole Attachments Act, and (3) open access to digital subscriber line (DSL) and cable modem networks providing high-speed broadband services.

Number of Pages in PDF File: 141

Accepted Paper Series


Download This Paper

Date posted: September 28, 2002  

Suggested Citation

Spulber, Daniel F. and Yoo, Christopher S., Access to Networks: Economic and Constitutional Connections. Cornell Law Review, Vol. 88, 2003; TPRC 2003; Vanderbilt Law and Economics Research Paper No. 02-08; Vanderbilt Public Law Research Paper No. 02-07; Northwestern Law & Econ Research Paper No. 03-05; Northwestern Public Law Research Paper No. 03-06. Available at SSRN: http://ssrn.com/abstract=333460 or http://dx.doi.org/10.2139/ssrn.333460

Contact Information

Daniel F. Spulber
Northwestern University - Kellogg School of Management ( email )
606 Leverone Hall
2001 Sheridan Road
Evanston, IL 60208
United States
847-491-8675 (Phone)
847-467-1777 (Fax)
Christopher S. Yoo (Contact Author)
University of Pennsylvania Law School ( email )
3501 Sansom St.
Philadelphia, PA 19104-6204
United States
(215) 746-8772 (Phone)
HOME PAGE: http://www.law.upenn.edu/faculty/csyoo/
University of Pennsylvania - Annenberg School for Communication ( email )
3620 Walnut St.
Philadelphia, PA 19104-6220
United States
(215) 746-8772 (Phone)
University of Pennsylvania - School of Engineering and Applied Science ( email )
3330 Walnut St.
Philadelphia, PA 19104-6309
United States
(215) 746-8772 (Phone)
Feedback to SSRN


Paper statistics
Abstract Views: 3,244
Downloads: 552
Download Rank: 25,370
Citations:  3
Footnotes:  733

© 2014 Social Science Electronic Publishing, Inc. All Rights Reserved.  FAQ   Terms of Use   Privacy Policy   Copyright   Contact Us
This page was processed by apollo8 in 0.312 seconds