Demand Elasticities for Mobile Telecommunications in Austria

31 Pages Posted: 11 Sep 2007

See all articles by Ralf Dewenter

Ralf Dewenter

University of the Federal Armed Forces Hamburg - Department of Economics

Justus Haucap

Heinrich Heine University Dusseldorf - Department of Economics; German Institute for Economic Research (DIW Berlin)

Date Written: June 2007

Abstract

This paper analyses price elasticities in the Austrian market for mobile telecommunications services using data on firm specific tariffs in the period between January 1998 and March 2002. Dynamic panel data regressions are used to estimate short-run and long-run demand elasticities for business customers and for private consumers with both postpaid contracts and prepaid cards. We find that business customers have a higher elasticity of demand than private consumers, where postpaid customers tend to have a higher demand elasticity than prepaid customers. Also demand is generally more elastic in the long run. In addition, the paper also provides estimates for firm-specific demand elasticities which range from -0.47 to -1.1.

Keywords: Mobile telephony, price elasticities, unbalanced panel data, dynamic panel data analysis

JEL Classification: C23, L13, L96

Suggested Citation

Dewenter, Ralf and Haucap, Justus, Demand Elasticities for Mobile Telecommunications in Austria (June 2007). Ruhr Economic Paper No. 17. Available at SSRN: https://ssrn.com/abstract=1012100 or http://dx.doi.org/10.2139/ssrn.1012100

Ralf Dewenter (Contact Author)

University of the Federal Armed Forces Hamburg - Department of Economics ( email )

Holstenhofweg 85
Hamburg, 22043
Germany

Justus Haucap

Heinrich Heine University Dusseldorf - Department of Economics ( email )

Duesseldorf
Germany

HOME PAGE: http://www.dice.uni-duesseldorf.de

German Institute for Economic Research (DIW Berlin) ( email )

Mohrenstra├če 58
Berlin, 10117
Germany

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