Estimating Market Power in the Internet Backbone Using Band-X Data

Cambridge Working Paper in Economics No. 0332

19 Pages Posted: 10 Oct 2003

See all articles by Emanuele Giovannetti

Emanuele Giovannetti

Anglia Ruskin University - Institute for International Management Practice, LAIBS

Cristiano Andrea Ristuccia

University of Cambridge - Department of Applied Economics

Date Written: June 2003

Abstract

Recent industry studies found the Internet backbone industry competitive. In our paper we explore a novel route to monitor for market power using prices and quality data from Band-X. First we test the hypothesis that Europe is a connectivity market on its own, unchallenged by the US and then, by using a Panel data Regression, we find that these markets are not very competitive since brand effects play a major role because price variations are only marginally affected by qualitative dimensions. More worryingly we find that companies with high prices are often able to supply an inferior quality I.P. transit.

Keywords: Internet, Market Power, Backbone, Competition Policy, Network Industries

JEL Classification: JEL: C33, L13, L86, L96

Suggested Citation

Giovannetti, Emanuele and Ristuccia, Cristiano Andrea, Estimating Market Power in the Internet Backbone Using Band-X Data (June 2003). Cambridge Working Paper in Economics No. 0332. Available at SSRN: https://ssrn.com/abstract=453482 or http://dx.doi.org/10.2139/ssrn.453482

Emanuele Giovannetti (Contact Author)

Anglia Ruskin University - Institute for International Management Practice, LAIBS ( email )

East Road
Cambridge, Cambridgeshire CB1 1PT
United Kingdom

HOME PAGE: http://anglia.ac.uk/ruskin/en/home/faculties/aibs/staff_profiles/all_staff/emanuele_giovannetti.html

Cristiano Andrea Ristuccia

University of Cambridge - Department of Applied Economics ( email )

Sidgwick Avenue
Austin Robinson Building
Cambridge CB3 9DE
United Kingdom
+44 1223 335285 (Phone)

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