Access pricing: A comparison between full deregulation and two alternative instruments of access price regulation, cost-based and retail-minus

• Type: Article in International Scientific Journal
• Date: 2007

Authors

Paula Sarmento (Author) FEP; António Brandão (Author) FEP

Journal

Title: Telecommunications Policy

Vol. 31 No. 5

Pages: 236-250

ISSN: 0308-5961

Publisher: Elsevier

Indexing

ISI Web of Knowledge - 16 Citations

Scopus - 21 Citations

Scientific classification

CORDIS: Social sciences > Economics

Other information

Authenticus ID: P-004-9Z9

DOI: 10.1016/j.telpol.2007.03.003

Abstract (EN): In this paper, two instruments of access price regulation, cost-based and retail-minus, are compared with the full deregulation hypothesis. For this purpose, a model that considers an upstream monopolist firm that sells a vital input to an independent firm and to a subsidiary firm in the downstream market is developed. The main conclusion of the paper is that retail-minus regulation avoids foreclosure and leads to better results than cost-based regulation in terms of investment level and consumer surplus. Moreover, retail-minus regulation allows a higher consumer surplus than deregulation of access price as long as the regulator carefully defines the retail-minus instrument.

Language: English

Type (Professor's evaluation): Scientific

No. of pages: 15