Two-Part Access Pricing and Imperfect Competition

25 Pages Posted: 6 Nov 1998

See all articles by Tommaso M. Valletti

Tommaso M. Valletti

Imperial College Business School; Centre for Economic Policy Research (CEPR)

Multiple version iconThere are 2 versions of this paper

Date Written: November 1998

Abstract

This paper considers a vertically separated industry with an upstream monopolist who supplies an essential input to two downstream Cournot firms. This situation is relevant to a number of sectors, including the telecommunications industry where trunk operators must have access to the local network of an incumbent firm to provide their long-distance service. The paper analyzes two-part access pricing and input price discrimination under different regulatory settings, and it finds that discrimination may produce adverse welfare effects when it is practiced by the unregulated upstream firm.

JEL Classification: D43, L51, L96

Suggested Citation

Valletti, Tommaso M., Two-Part Access Pricing and Imperfect Competition (November 1998). FEEM Working Paper ETA 34.98. Available at SSRN: https://ssrn.com/abstract=122131 or http://dx.doi.org/10.2139/ssrn.122131

Tommaso M. Valletti (Contact Author)

Imperial College Business School ( email )

South Kensington Campus
Exhibition Road
London SW7 2AZ, SW7 2AZ
United Kingdom

Centre for Economic Policy Research (CEPR)

London
United Kingdom

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