IDEAS home Printed from https://ideas.repec.org/a/taf/ijecbs/v9y2002i3p419-436.html
   My bibliography  Save this article

Laffont and Tirole's Competition in Telecommunications : A View From the US

Author

Listed:
  • Steve Parsons

Abstract

This article briefly reviews Competition in Telecommunications by Laffont andTirole (2000); it presents the major conclusions of the book and corrects certain errors. In addition, this article treats related topics, some specific to the US telecommunications industry. In US telecommunications access to incumbents facilities are priced based on cost model estimates. Several of the important sources of misunderstandings of telecommunications costs and cost estimates are described including: multiple meanings of 'access,'meanings of cross-subsidy; nature of loop costs; the many dimensions of marginal costs in telecommunications, misuses of long-run cost concepts; and misuses of 'most efficient' provider assumptions. The methods of cost calculations and legal and regulatory requirements in the US are described, as are the implications for incentive regulation, changing technology, efficient pricing, and measures of efficient competitive entry.

Suggested Citation

  • Steve Parsons, 2002. "Laffont and Tirole's Competition in Telecommunications : A View From the US," International Journal of the Economics of Business, Taylor & Francis Journals, vol. 9(3), pages 419-436.
    • Handle: RePEc:taf:ijecbs:v:9:y:2002:i:3:p:419-436
    DOI: 10.1080/1357151021000010409
    as

    Download full text from publisher

    File URL: http://www.tandfonline.com/10.1080/1357151021000010409
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1080/1357151021000010409?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Craven, John, 1985. "Peak-Load Pricing and Short-run Marginal Cost," Economic Journal, Royal Economic Society, vol. 95(379), pages 778-780, September.
    2. Vickrey, William, 1992. "Efficient pricing of electric power service : Some innovative solutions," Resources and Energy, Elsevier, vol. 14(1-2), pages 157-174, April.
    3. Faulhaber, Gerald R, 1975. "Cross-Subsidization: Pricing in Public Enterprises," American Economic Review, American Economic Association, vol. 65(5), pages 966-977, December.
    4. Sharkey, William W. & Telser, Lester G., 1978. "Supportable cost functions for the multiproduct firm," Journal of Economic Theory, Elsevier, vol. 18(1), pages 23-37, June.
    5. Della Valle, Anna P., 1988. "Short-run versus long-run marginal cost pricing," Energy Economics, Elsevier, vol. 10(4), pages 283-286, October.
    6. Turvey, R, 1969. "Marginal Cost," Economic Journal, Royal Economic Society, vol. 79(314), pages 282-299, June.
    7. Peter S. Fisher, 1991. "The Strange Career of Marginal Cost Pricing," Journal of Economic Issues, Taylor & Francis Journals, vol. 25(1), pages 77-92, March.
    8. Brown, Gardner, Jr & Johnson, M Bruce, 1969. "Public Utility Pricing and Output under Risk," American Economic Review, American Economic Association, vol. 59(1), pages 119-128, March.
    9. Parsons, Steve G, 1998. "Cross-Subsidization in Telecommunications," Journal of Regulatory Economics, Springer, vol. 13(2), pages 157-182, March.
    10. Ronald H. Coase, 1970. "The Theory of Public Utility Pricing and Its Application," Bell Journal of Economics, The RAND Corporation, vol. 1(1), pages 113-128, Spring.
    11. F. H. Knight, 1921. "Cost of Production and Price over Long and Short Periods," Journal of Political Economy, University of Chicago Press, vol. 29(4), pages 304-304.
    12. W.W. Sharkey, 1982. "Suggestions for a Game-Theoretic Approach to Public Utility Pricing and Cost Allocation," Bell Journal of Economics, The RAND Corporation, vol. 13(1), pages 57-68, Spring.
    13. Andersson, Roland & Bohman, Mats, 1985. "Short- and long-run marginal cost pricing : On their alleged equivalence," Energy Economics, Elsevier, vol. 7(4), pages 279-288, October.
    14. Faulhaber, Gerald R & Levinson, Stephen B, 1981. "Subsidy-Free Prices and Anonymous Equity [Cross-Subsidization: Pricing in Public Enterprises]," American Economic Review, American Economic Association, vol. 71(5), pages 1083-1091, December.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. repec:ipg:wpaper:2014-580 is not listed on IDEAS
    2. Sami Debbichi & Walid Hichri, 2014. "Market Power and Collusion on Interconnection Phone Market in Tunisia : What Lessons from International Experiences," Working Papers halshs-00956638, HAL.
    3. Wenqian Zou & Meichen Yu & Shoshi MIZOKAMI, 2019. "Mechanism Design for an Incentive Subsidy Scheme for Bus Transport," Sustainability, MDPI, vol. 11(6), pages 1-13, March.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. David Encaoua & Michel Moreaux, 1987. "L'analyse théorique des problèmes de tarification et d'allocation des coûts dans les télécommunications," Revue Économique, Programme National Persée, vol. 38(2), pages 375-414.
    2. Mosácula, Celia & Chaves-Ávila, José Pablo & Reneses, Javier, 2019. "Reviewing the design of natural gas network charges considering regulatory principles as guiding criteria in the context of the increasing interrelation of energy carriers," Energy Policy, Elsevier, vol. 126(C), pages 545-557.
    3. Leonard J. Mirman & Yair Tauman & Israel Zang, 1985. "Supportability, Sustainability, and Subsidy-Free Prices," RAND Journal of Economics, The RAND Corporation, vol. 16(1), pages 114-126, Spring.
    4. David Lowing & Léa Munich & Kevin Techer, 2024. "Allocating the common costs of a public service operator: an axiomatic approach," Working Papers of BETA 2024-03, Bureau d'Economie Théorique et Appliquée, UDS, Strasbourg.
    5. Jamison, Mark A., 1996. "General conditions for subsidy-free prices," Journal of Economics and Business, Elsevier, vol. 48(4), pages 371-385, October.
    6. Massimo Marinacci & Luigi Montrucchio, 2003. "Ultramodular functions," ICER Working Papers - Applied Mathematics Series 13-2003, ICER - International Centre for Economic Research.
    7. Haller Andreas & Christian Jaag & Urs Trinkner, 2014. "USO cost allocation rules and welfare," Working Papers 0049, Swiss Economics.
    8. David Lowing & Léa Munich & Kevin Techer, 2024. "Allocating the common costs of a public service operator: an axiomatic approach," Working Papers 2024-05, CRESE.
    9. Dirk Meyer, 2002. "Regulierung versus Deregulierung im Öffentlichen Personennahverkehr – Das Modell eines Nutzerklubs," Perspektiven der Wirtschaftspolitik, Verein für Socialpolitik, vol. 3(1), pages 69-84, February.
    10. Urs Trinkner & Christian Jaag & Andreas Haller, 2019. "Funding Universal Services: Cross-subsidization and Net cost balancing," Working Papers 0064, Swiss Economics.
    11. Olivier Massol & Stéphane Tchung-Ming, 2012. "Joining the CCS Club ! Insights from a Northwest European CO2 pipeline project," Working Papers hal-03206457, HAL.
    12. Massol, Olivier & Tchung-Ming, Stéphane & Banal-Estañol, Albert, 2015. "Joining the CCS club! The economics of CO2 pipeline projects," European Journal of Operational Research, Elsevier, vol. 247(1), pages 259-275.
    13. Dina Mohamed Yousri, 2011. "The Egyptian Electricity Market: Designing a Prudent Peak Load Pricing Model," Working Papers 29, The German University in Cairo, Faculty of Management Technology.
    14. Björkqvist, Olof & Idefeldt, Jim & Larsson, Aron, 2010. "Risk assessment of new pricing strategies in the district heating market: A case study at Sundsvall Energi AB," Energy Policy, Elsevier, vol. 38(5), pages 2171-2178, May.
    15. Scott, Susan & Lawlor, John, 1994. "Waste Water Services: Charging Industry the Capital Cost," Research Series, Economic and Social Research Institute (ESRI), number PRS22.
    16. Mark A. Jamison, 2011. "Liberalization and Regulation of Telecoms, Electricity, and Gas in the United States," Chapters, in: Matthias Finger & Rolf W. Künneke (ed.), International Handbook of Network Industries, chapter 21, Edward Elgar Publishing.
    17. David, Laurent & Le Breton, Michel & Merillon, Olivier, 2007. "Kolm as a Contributor to Public Utility Pricing, Second Best Culture and the Theory of Regulation," IDEI Working Papers 490, Institut d'Économie Industrielle (IDEI), Toulouse.
    18. Dina Mohamed YOUSRI, 2016. "The Egyptian Electricity Market: Designing a Prudent Peak Load Pricing System," Turkish Economic Review, KSP Journals, vol. 3(4), pages 677-682, December.
    19. Sawkins, John W. & Reid, Scott, 2007. "The measurement and regulation of cross subsidy. The case of the Scottish water industry," Utilities Policy, Elsevier, vol. 15(1), pages 36-48, March.
    20. G. Knieps & H. Sommer, 1988. "Kostenaufteilung bei Mehrzweckprojekten," Swiss Journal of Economics and Statistics (SJES), Swiss Society of Economics and Statistics (SSES), vol. 124(II), pages 151-174, June.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:taf:ijecbs:v:9:y:2002:i:3:p:419-436. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Longhurst (email available below). General contact details of provider: http://www.tandfonline.com/CIJB20 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.