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Efficient contracts for government intervention in promoting next generation communications networks

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  • Briglauer, Wolfgang
  • Holzleitner, Christian

Abstract

Although the future socio-economic benefits of a new fibre-based ('next generation access', NGA) telecommunications infrastructure seem to be uncontroversial, a universal NGA coverage appears to be a rather unrealistic objective without government intervention. We contend, however, that the current contract practice of fixing ex ante targets for network expansion is inefficient given the uncertainty about future returns on NGA infrastructure-based services and the public authorities' incomplete information about the capital costs of the network provider. This paper puts forward to delegate the choice of the network expansion to the NGA provider.

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  • Briglauer, Wolfgang & Holzleitner, Christian, 2014. "Efficient contracts for government intervention in promoting next generation communications networks," ZEW Discussion Papers 14-022, ZEW - Leibniz Centre for European Economic Research.
    • Handle: RePEc:zbw:zewdip:14022
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    References listed on IDEAS

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    1. Briglauer Wolfgang & Frübing Stefan & Vogelsang Ingo, 2014. "The Impact of Alternative Public Policies on the Deployment of New Communications Infrastructure – A Survey," Review of Network Economics, De Gruyter, vol. 13(3), pages 227-270, September.
    2. Briglauer, Wolfgang & Gugler, Klaus, 2013. "The deployment and penetration of high-speed fiber networks and services: Why are EU member states lagging behind?," Telecommunications Policy, Elsevier, vol. 37(10), pages 819-835.

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    More about this item

    Keywords

    contract theory; public utilities; next generation telecommunications networks; subsidies;
    All these keywords.

    JEL classification:

    • H20 - Public Economics - - Taxation, Subsidies, and Revenue - - - General
    • L43 - Industrial Organization - - Antitrust Issues and Policies - - - Legal Monopolies and Regulation or Deregulation
    • L44 - Industrial Organization - - Antitrust Issues and Policies - - - Antitrust Policy and Public Enterprise, Nonprofit Institutions, and Professional Organizations
    • L51 - Industrial Organization - - Regulation and Industrial Policy - - - Economics of Regulation
    • L52 - Industrial Organization - - Regulation and Industrial Policy - - - Industrial Policy; Sectoral Planning Methods
    • L96 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Telecommunications

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