Are Fixed and Cell Phones Substitutes or Compliments? The Case of Brazil
27 Pages Posted: 31 May 2006
Date Written: May 2006
This paper investigates whether the growth of cell telephony in Brazil after privatization is taking place at the expense of the fixed telephony. We use national household surveys and find that first, despite the rapid growth in cell telephony, complementarity between both types of telephony is still dominant at the household level; second, phone subscription is strongly determined by income, demographic and regional characteristics; and third, cell telephony plays a substitutive role with respect to fixed telephony in rural areas, but a complementary one in urban areas.
Keywords: fixed telephony, cell telephony, substitute, complementary, Brazil
JEL Classification: D12, L96, L98
Suggested Citation: Suggested Citation