Transparency Regulation as a Remedy for Network Neutrality Concerns: Experimental Results

Abstract

We present a research project in experimental law and economics about the effects of new transparency provisions in European telecommunications law on Internet Service Providers (ISPs) and end-users in broadband markets, with implications for the debate on network neutrality. Our experiment evaluates the effects of increased transparency about the actual quality of broadband Internet. We compare four treatments in which end-users have different amounts of information about broadband quality. We conclude that (1) more information about the quality of a broadband connection leads to higher total surplus and higher end-user surplus; (2) quality provided by ISPs increases with the level of transparency; (3) quality and efficiency are marginally higher when full information about quality is only available to some end-users, than when all end-users have imperfect information about quality. To these findings we attach a number of policy-related conclusions.

Keywords: Telecommunications Regulation, Transparency, Experimental Law and Economics, Network Neutrality, Consumer Protection

JEL Classification: C91, L13, L15, K23