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International Telecommunications, Settlement Rates, and the FCC

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  • Wright, Julian

Abstract

This paper models settlement arrangements between international telecommunication carriers. The FCC in the United States claims these arrangements cost United States consumers billions of dollars annually, largely to subsidize foreign carriers in low-income countries. A model is given which makes sense of this claim, as well as the role of costs, competition, and income disparities in settlement rate determination. Findings are tested using data spanning 17 years and 167 countries. Some implications are drawn for the FCC's recently proposed settlement rate caps, as well as for proposals for multilateral solutions. Copyright 1999 by Kluwer Academic Publishers

Suggested Citation

  • Wright, Julian, 1999. "International Telecommunications, Settlement Rates, and the FCC," Journal of Regulatory Economics, Springer, vol. 15(3), pages 267-291, May.
    • Handle: RePEc:kap:regeco:v:15:y:1999:i:3:p:267-91
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    Citations

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    Cited by:

    1. Michael Carter & Julian Wright, 1999. "Bargaining over Interconnection: The Clear‐Telecom Dispute," The Economic Record, The Economic Society of Australia, vol. 75(3), pages 241-255, September.
    2. repec:kap:iaecre:v:12:y:2006:i:1:p:131-137 is not listed on IDEAS
    3. Christos Agiakloglou & Michael Polemis, 2018. "Evaluating the liberalization process on Telecommunications services for EU countries," Economics and Business Letters, Oviedo University Press, vol. 7(3), pages 98-107.
    4. Joan Calzada & Francesc Trillas, 2005. "The interconnection prices in telecomunications: from theory to practice," Hacienda Pública Española / Review of Public Economics, IEF, vol. 173(2), pages 85-125, June.
    5. Mayo, John W. & Ukhaneva, Olga, 2017. "International telecommunications demand," Information Economics and Policy, Elsevier, vol. 39(C), pages 26-35.
    6. Domon, Koji & Ota, Koshiro, 2001. "Access pricing and market structure," Information Economics and Policy, Elsevier, vol. 13(1), pages 77-93, March.
    7. Simran Kahai & Paramjit Kahai & Adrian Leigh, 2006. "Traditional and Non-Traditional Determinants of Accounting Rates in International Telecommunications," International Advances in Economic Research, Springer;International Atlantic Economic Society, vol. 12(4), pages 505-522, November.
    8. Heng Ju & Guofu Tan, 2016. "Bilateral Market Structures And Regulatory Policies In International Telephone Markets," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 57(2), pages 393-424, May.
    9. repec:kap:iaecre:v:12:y:2006:i:4:p:505-522 is not listed on IDEAS
    10. Agiakloglou, Christos & Polemis, Michael, 2015. "What determines demand for Telecommunications services? Evidence from the EU countries before and after liberalization," 26th European Regional ITS Conference, Madrid 2015 127119, International Telecommunications Society (ITS).
    11. Agiakloglou, Christos & Gkouvakis, Michalis, 2012. "Causal interrelations among market fundamentals: Evidence from the Europen telecommunications sector," 23rd European Regional ITS Conference, Vienna 2012 60387, International Telecommunications Society (ITS).
    12. Agiakloglou, Christos & Karkalakos, Sotiris, 2006. "Estimating Diffusion Rates for Telecommunications: Evidence from European Union," MPRA Paper 45788, University Library of Munich, Germany.
    13. Armstrong, Mark, 2001. "The theory of access pricing and interconnection," MPRA Paper 15608, University Library of Munich, Germany.
    14. Alberto Nucciarelli & Massimo Gastaldi & Nathan Levialdi, 2010. "Asymmetric competition and collection rates differentials: determinants of prices in international telephone service markets," Netnomics, Springer, vol. 11(3), pages 315-329, October.
    15. James Alleman & Gary Madden & Scott Savage, 2003. "Dominant carrier market power in US international telephone markets," Applied Economics, Taylor & Francis Journals, vol. 35(6), pages 665-673.
    16. Agiakloglou, Christos & Karkalakos, Sotiris, 2006. "Estimating Diffusion Rates for Telecommunications: Evidence from European Union," MPRA Paper 45862, University Library of Munich, Germany.
    17. Agiakloglou, Christos & Gkouvakis, Michail, 2015. "Causal interrelations among market fundamentals: Evidence from the European Telecommunications sector," The Quarterly Review of Economics and Finance, Elsevier, vol. 55(C), pages 150-159.
    18. Christos Agiakloglou & Demetrius Yannelis, 2006. "Estimation of Price Elasticities for International Telecommunications Demand," International Advances in Economic Research, Springer;International Atlantic Economic Society, vol. 12(1), pages 131-137, February.
    19. Tangerås, Thomas P. & Tåg, Joacim, 2016. "International network competition under national regulation," International Journal of Industrial Organization, Elsevier, vol. 47(C), pages 152-185.
    20. Einhorn, Michael A., 2002. "International telephony: a review of the literature," Information Economics and Policy, Elsevier, vol. 14(1), pages 51-73, March.

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