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An Empirical Analysis of the Demand for Fixed and Mobile Telecommunications Services

Posted: 3 Jan 2013 Last revised: 10 Jan 2013

Yongkyu Kim

Hanyang University - Department of Economics

Jin-Soo Yoo

Sookmyung Women's University - Department of Economics

Seonghoon Jeon

Sogang University - Department of Economics

Yoon-Jae Whang

Seoul National University - School of Economics

Date Written: December 31, 2012

Abstract

In this paper, we estimate the own- and cross-price elasticities and income elasticity of various fixed and mobile telephone services using monthly time series data. We estimate expenditure share of various telecommunications services such as local, toll, LM (Land to Mobile), Mobile Voice and Short Message Services. We employ AIDS (Almost Ideal Demand System) as the estimation model and employ Triangular Error Correction Model in the estimation to consider the cointegrated relationship between variables. We show that the own-price elasticity of the demand for local call is -1.06 and the own-price elasticity of the demand for mobile is -0.85. This result is consistent with those of previous studies. (written in Korean)

Keywords: Fixed and mobile telephone demand, Own-price elasticity, Cross-price elasticity, AIDS, SMS

Suggested Citation

Kim, Yongkyu and Yoo, Jin-Soo and Jeon, Seonghoon and Whang, Yoon-Jae, An Empirical Analysis of the Demand for Fixed and Mobile Telecommunications Services (December 31, 2012). International Telecommunications Policy Review, Vol. 19, No. 4, 2012. Available at SSRN: https://ssrn.com/abstract=2195068

Yongkyu Kim (Contact Author)

Hanyang University - Department of Economics ( email )

Hanyang Daehak Ro 55
Sangrok-Gu
Ansan, Kyunggi 426-791
Korea, Democratic People's Republic (North Korea)
+82-31-400-5607 (Phone)
+82-31-400-5838 (Fax)

Jin-Soo Yoo

Sookmyung Women's University - Department of Economics ( email )

53-12, Chungpa-dong Yongsan-gu
Seoul
Korea, Republic of (South Korea)

Seonghoon Jeon

Sogang University - Department of Economics ( email )

35 Baekbeom-ro
Seoul, 121-742
Korea, Republic of (South Korea)

Yoon-Jae Whang

Seoul National University - School of Economics ( email )

San 56-1, Silim-dong, Kwanak-ku
Seoul 151-742
Korea
+82 2 80 6362 (Phone)
+82 2 86 4231 (Fax)

HOME PAGE: http://plaza.snu.ac.kr/~whang

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