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Telecommunications Deregulation

Author

Listed:
  • Jerry A. Hausman
  • William E. Taylor

Abstract

From Fred Kahn's writings and experiences as a telecommunications regulator and commenter, we draw the following conclusions: prices must be informed by costs; costs are actual incremental costs; costs and prices are an outcome of a Schumpeterian competitive process, not the starting point; excluding incumbents from markets is fundamentally anticompetitive; and a regulatory transition to deregulation entails propensities to micromanage the process to generate preferred outcomes, visible competitors and expedient price reductions. And most important, where effective competition takes place among platforms characterized by sunk investment--land-line telephony, cable and wireless--traditional regulation is unnecessary and likely to be anticompetitive.

Suggested Citation

  • Jerry A. Hausman & William E. Taylor, 2012. "Telecommunications Deregulation," American Economic Review, American Economic Association, vol. 102(3), pages 386-390, May.
    • Handle: RePEc:aea:aecrev:v:102:y:2012:i:3:p:386-90
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    References listed on IDEAS

    as
    1. Kahn, Alfred E. & Tardiff, Timothy J. & Weisman, Dennis L., 1999. "The Telecommunications Act at three years: an economic evaluation of its implementation by the Federal Communications Commission," Information Economics and Policy, Elsevier, vol. 11(4), pages 319-365, December.
    2. Jerry A. Hausman, 1997. "Valuing the Effect of Regulation on New Services in Telecommunications," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 28(1997 Micr), pages 1-54.
    3. repec:reg:rpubli:433 is not listed on IDEAS
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    Cited by:

    1. Mohammadi, Mohammad Ali, 2021. "Estimating Possible Subsidy Effects in Broadband Services and Deployment," MPRA Paper 111962, University Library of Munich, Germany.
    2. Kyle Wilson, 2015. "Investment, Subsidies, and Universal Service: Broadband Internet in the United States," Working Papers 15-09, NET Institute.
    3. Howell, Bronwyn E. & Potgieter, Petrus H., 2020. "Politics, policy and fixed-line telecommunications provision: Insights from Australia," Telecommunications Policy, Elsevier, vol. 44(7).
    4. Ying Fan & Mo Xiao, 2015. "Competition and subsidies in the deregulated US local telephone industry," RAND Journal of Economics, RAND Corporation, vol. 46(4), pages 751-776, October.
    5. Kyle Wilson, 2016. "Does Public Competition Crowd Out Private Investment? Evidence from Municipal Provision of Internet Access," Working Papers 16-16, NET Institute.

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