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Contestability and pricing flexibility: Issues in Hong Kong

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  • Bernard, Keith
  • Tracy Sum, C. S.

Abstract

This paper elaborates how Hong Kong Telephone Company Limited (HKTC) has played its role in facilitating contestability in the market place. International comparisons are drawn to indicate Hong Kong's progress in the liberalization of the telecommunications industry. Given the market contestability already in place, pricing flexibility should be allowed to the incumbent. Competitive benchmarks on price should be relative to incremental cost which drives economically efficient market behaviour. Discounts with price differentiation should be allowed where prices are not anticompetitive, do not distort allocative efficiency and are non-discriminatory.

Suggested Citation

  • Bernard, Keith & Tracy Sum, C. S., 1997. "Contestability and pricing flexibility: Issues in Hong Kong," Telecommunications Policy, Elsevier, vol. 21(1), pages 3-13, February.
    • Handle: RePEc:eee:telpol:v:21:y:1997:i:1:p:3-13
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