Price distortion under fixed-mobile substitution

• Autores: Marc Bourreau, Carlo Cambini, Steffen Hoemig
• Localización: Economia e Politica Industriale, ISSN 0391-2078, ISSN-e 1972-4977, Vol. 42, Nº. 4, 2015, págs. 441-454
• Idioma: inglés
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• Resumen

  • This paper analyses the impact of substitution between fixed and mobile telephony on call prices. We develop a model where consumers differ in the benefits of mobility and firms price discriminate between on-net and off-net calls. We find that call prices are distorted downwards due to substitution possibilities and customer heterogeneity, and that this distortion increases with the fixed-mobile termination mark-up.