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Strategic Regulation Policy in the Internet

Author

Listed:
  • Østein Foros
  • Hans Kind
  • Lars Søard

Abstract

Some countries are importers while others are exporters of global backbone connectivity. At the same time, input components such as local access are non-traded. This paper analyzes a non-cooperative regulatory game between importing and exporting countries, assuming that the prices of both traded and non-traded inputs can be regulated. We show that exporting countries choose a more restrictive regulation of non-traded goods than importing countries do. We further show that a requirement of international non-discrimination may hurt importing countries, and give firms producing traded inputs incentives to invest in quality degradation. Copyright Springer Science+Business Media, LLC 2006

Suggested Citation

  • Østein Foros & Hans Kind & Lars Søard, 2006. "Strategic Regulation Policy in the Internet," Journal of Regulatory Economics, Springer, vol. 30(1), pages 63-84, July.
    • Handle: RePEc:kap:regeco:v:30:y:2006:i:1:p:63-84
    DOI: 10.1007/s11149-006-0009-2
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    References listed on IDEAS

    as
    1. Nicholas Economides, 2004. "The Economics of the Internet Backbone," Working Papers 04-23, NET Institute, revised Oct 2004.
    2. Brander, James A., 1995. "Strategic trade policy," Handbook of International Economics, in: G. M. Grossman & K. Rogoff (ed.), Handbook of International Economics, edition 1, volume 3, chapter 27, pages 1395-1455, Elsevier.
    3. repec:reg:rpubli:115 is not listed on IDEAS
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    More about this item

    Keywords

    Complementarities; Regulation; Non-discrimination; Internet; L13; L51; L96;
    All these keywords.

    JEL classification:

    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
    • L51 - Industrial Organization - - Regulation and Industrial Policy - - - Economics of Regulation
    • L96 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Telecommunications

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