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The Impact of Spectrum Prices in the Telecommunication Sector on Network Investments

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  • Saringkarnpoonperm, Suttiwit
  • Khemakongkanonth, Chate
  • Srinuan, Pratompong

Abstract

This paper aims to examine the impact of spectrum prices on mobile operators' industry investment using country-level data from 13 countries spanning 2013 to 2022. We employ four models to explore the quantitative evidence, with a preference for the one-step system GMM model through hypothesis testing. The results indicate that significant factors influencing investment include prior CAPEX, urban population, ARPU, GDP, and HHI, while spectrum prices and fees do not show significance. To address limitations, we suggest expanding sample sizes and incorporating additional instruments and dependent variables to establish evidence-based insights into the relationship between spectrum prices and CAPEX.

Suggested Citation

  • Saringkarnpoonperm, Suttiwit & Khemakongkanonth, Chate & Srinuan, Pratompong, 2024. "The Impact of Spectrum Prices in the Telecommunication Sector on Network Investments," 24th ITS Biennial Conference, Seoul 2024. New bottles for new wine: digital transformation demands new policies and strategies 302470, International Telecommunications Society (ITS).
    • Handle: RePEc:zbw:itsb24:302470
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    References listed on IDEAS

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    1. Peter Cramton, 2013. "Spectrum Auction Design," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 42(2), pages 161-190, March.
    2. Bahia, Kalvin & Castells, Pau, 2022. "The impact of spectrum assignment policies on consumer welfare," Telecommunications Policy, Elsevier, vol. 46(1).
    3. Park, Minsoo & Lee, Sang-Woo & Choi, Yong-Jae, 2011. "Does spectrum auctioning harm consumers? Lessons from 3G licensing," Information Economics and Policy, Elsevier, vol. 23(1), pages 118-126, March.
    4. Matthew D. Shapiro, 1986. "Investment, Output, and the Cost of Capital," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 17(1), pages 111-164.
    5. Jung, Juan & Katz, Raúl, 2022. "Spectrum flexibility and mobile telecommunications development," Utilities Policy, Elsevier, vol. 75(C).
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