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Competition and Price Dispersion in International Long-distance Calling

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  • Sean Ennis

Abstract

This paper examines the relationship between changes in telecommunications provider competition on international long-distance routes and changes in prices. Overall, increased competition is associated with significantly lower prices to consumers of long-distance services. However, the relationship between competition and price varies according to the type of long-distance plan considered. For the plans frequently selected by price-conscious consumers, increased competition on a route is associated with lower prices. In contrast, for the basic international plans that are the default selection for consumers, increased competition on a route is actually associated with higher prices. Thus price dispersion appears to increase as competition increases. Copyright Springer Science+Business Media, Inc. 2006

Suggested Citation

  • Sean Ennis, 2006. "Competition and Price Dispersion in International Long-distance Calling," Journal of Regulatory Economics, Springer, vol. 29(3), pages 303-317, May.
    • Handle: RePEc:kap:regeco:v:29:y:2006:i:3:p:303-317
    DOI: 10.1007/s11149-006-7401-9
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    References listed on IDEAS

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    1. Marius Schwartz & David Malueg, 1998. "Where Have All the Minutes Gone? Asymmetric Telecom Liberalization, Carrier Alliances, and Gaming of International Settlements," Industrial Organization 9808002, University Library of Munich, Germany.
    2. Mariano Tommasi, 1993. "Don't be Ignorant: Price Dispersion is Not a Measure of Ignorance in the Market," UCLA Economics Working Papers 699, UCLA Department of Economics.
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    Cited by:

    1. Jason Pearcy & Scott J. Savage, 2009. "The Effects of International Simple Resale on Prices in International Telecommunications Markets," Working Papers 09-19, NET Institute, revised Sep 2009.
    2. Russell Pittman, 2003. "Vertical Restructuring (or Not) of the Infrastructure Sectors of Transition Economies," Journal of Industry, Competition and Trade, Springer, vol. 3(1), pages 5-26, March.
    3. Russell Pittman, 2001. "Vertical Restructuring of the Infrastructure Sectors of Transition Economies," Industrial Organization 0111002, University Library of Munich, Germany.

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    More about this item

    Keywords

    Telecommunications; Competition; Price dispersion; D43; L96;
    All these keywords.

    JEL classification:

    • D43 - Microeconomics - - Market Structure, Pricing, and Design - - - Oligopoly and Other Forms of Market Imperfection
    • L96 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Telecommunications

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