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Telecommunication in the US: From Regulation to Competition (Almost)

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  • Jerry Hausman
  • William Taylor

Abstract

Alfred E. Kahn was an observer and practitioner of telecommunications regulation as technology changed the industry from a natural monopoly to a platform-based oligopoly among telephone, cable, satellite, and wireless carriers. Regulation and legislation were slow to recognize these changes, and large welfare losses occurred, some of which could have been avoided if regulators, legislators and economists had followed Fred’s economic advice: Prices must be informed by costs; the relevant costs are actual incremental costs; costs and prices are an outcome of a Schumpeterian competitive process, not the starting point; excluding firms from markets is fundamentally anticompetitive; a reliance on imperfect markets subject to antitrust law is preferable to necessarily imperfect regulation; and a regulatory transition to deregulation entails propensities to micromanage the process to generate preferred outcomes, visible competitors, and expedient price reductions. Copyright Springer Science+Business Media New York 2013

Suggested Citation

  • Jerry Hausman & William Taylor, 2013. "Telecommunication in the US: From Regulation to Competition (Almost)," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 42(2), pages 203-230, March.
    • Handle: RePEc:kap:revind:v:42:y:2013:i:2:p:203-230
    DOI: 10.1007/s11151-012-9366-4
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    References 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. Howell, Bronwyn E. & Potgieter, Petrus H., 2022. "Effective competition and ineffective mobile industry regulation in South Africa," Telecommunications Policy, Elsevier, vol. 46(7).
    3. I. Vogelsang, 2015. "Will the U.S. and EU telecommunications policies converge? A survey," Economia e Politica Industriale: Journal of Industrial and Business Economics, Springer;Associazione Amici di Economia e Politica Industriale, vol. 42(2), pages 117-155, June.
    4. Briglauer, Wolfgang & Cambini, Carlo & Fetzer, Thomas & Hüschelrath, Kai, 2017. "The European Electronic Communications Code: A critical appraisal with a focus on incentivizing investment in next generation broadband networks," Telecommunications Policy, Elsevier, vol. 41(10), pages 948-961.
    5. Bertschek, Irene & Briglauer, Wolfgang & Hüschelrath, Kai & Krämer, Jan & Frübing, Stefan & Kesler, Reinhold & Saam, Marianne, 2016. "Metastudie zum Fachdialog Ordnungsrahmen für die Digitale Wirtschaft: Im Auftrag des Bundesministeriums für Wirtschaft und Energie (BMWi)," ZEW Expertises, ZEW - Leibniz Centre for European Economic Research, number 147040.
    6. Benjamin Dachis & Daniel Schwanen, 2016. "Changing the Channel on Canadian Communications Regulation," C.D. Howe Institute Commentary, C.D. Howe Institute, issue 451, May.
    7. n/a, 2014. "Book Reviews," Economics of Energy & Environmental Policy, International Association for Energy Economics, vol. 0(Number 2).

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