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Tradable universal service obligations

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  • Peha, Jon M.

Abstract

This paper proposes a novel policy to motivate private-sector operators of basic infrastructure to expand infrastructure into previously unserved regions. It is particularly useful when resources are transferred to the private sector, as occurs during the privatisation of a state-owned telecommunications carrier, the introduction of competition, the release of spectrum, or the allocation of cash subsidies for this purpose. Firms receive tradable universal service obligations in the form of milestones that must be met, and commitments to meet specific deadlines. By exchanging its commitments, a firm can increase or decrease the rate at which it must expand infrastructure. By exchanging milestones, a firm can change where it must expand infrastructure. Making milestones and commitments independent and fully tradable allows each firm to develop the most cost effective business strategy possible, and to adapt that strategy as technology and demand evolve over time. The exchange of milestones and commitments does not diminish the obligations that must be met by industry as a whole, insuring the timely expansion of infrastructure. This paper focuses on telecommunications, but the approach is also applicable to other forms of infrastructure, such as electric power.

Suggested Citation

  • Peha, Jon M., 1999. "Tradable universal service obligations," Telecommunications Policy, Elsevier, vol. 23(5), pages 363-374, June.
    • Handle: RePEc:eee:telpol:v:23:y:1999:i:5:p:363-374
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    Citations

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    Cited by:

    1. Madden, Gary & Savage, Scott J. & Coble-Neal, Grant & Bloxham, Paul, 2000. "Advanced communications policy and adoption in rural Western Australia," Telecommunications Policy, Elsevier, vol. 24(4), pages 291-304, May.
    2. Thai, Do Manh & Falch, Morten, 2018. "Universal service in Vietnam: An institutional approach," Telecommunications Policy, Elsevier, vol. 42(4), pages 323-332.
    3. Joan Calzada & Christian Jaag & Urs Trinkner, 2010. "Universal service auctions in liberalized postal markets," Chapters, in: Michael A. Crew & Paul R. Kleindorfer (ed.), Heightening Competition in the Postal and Delivery Sector, chapter 17, Edward Elgar Publishing.
    4. Ramos, Boris & Saeed, Khalid & Pavlov, Oleg, 2010. "The impact of Universal Service Obligations and International Cross-subsidies on the dispersion of telephone services in developing countries," Socio-Economic Planning Sciences, Elsevier, vol. 44(2), pages 57-72, June.
    5. Bjorn Wellenius, 2000. "Extending Telecommunications beyond the Market : Toward Universal Service in Competitive Environments," World Bank Publications - Reports 11439, The World Bank Group.
    6. El hussieny, Nader & Gharib, Heba Ibrahim & Khamis, Mohab Ibrahim, 2019. "Case study: Universal service policies and its impact on universal service projects quantity and quality in Egypt," 2nd Europe – Middle East – North African Regional ITS Conference, Aswan 2019: Leveraging Technologies For Growth 201757, International Telecommunications Society (ITS).
    7. Carlos Costa, 2012. "On the Use of Reverse Auctions to Designate Universal Postal Service Providers," Chapters, in: Michael A. Crew & Paul R. Kleindorfer (ed.), Multi-Modal Competition and the Future of Mail, chapter 21, Edward Elgar Publishing.
    8. Roy Chun Lee & Christopher Findlay, 2005. "Telecommunications reform in Indonesia: Achievements and challenges," Bulletin of Indonesian Economic Studies, Taylor & Francis Journals, vol. 41(3), pages 341-365.
    9. Thai, Do Manh & Falch, Morten & Williams, Idongesit, 2015. "The Role Of Stakeholders On Implementing Universal Services In Vietnam," 26th European Regional ITS Conference, Madrid 2015 127184, International Telecommunications Society (ITS).

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