Arbeitspapier

Deregulating network industries: Dealing with price-quality tradeoffs

This paper examines the effects of introducing competition into monopolized network industries on prices and infrastructure quality. Analyzing a model with reduced-form demand, we first show that deregulating an integrated monopoly cannot simultaneously decrease the retail price and increase infrastructure quality. Second, we derive conditions under which reducing both retail price and infrastructure quality relative to the integrated monopoly outcome increases welfare. Third, we argue that restructuring and setting very low access charges may yield welfare losses, as infrastructure investment is undermined. We provide an extensive analysis of the linear demand model and discuss policy implications.

Sprache
Englisch

Erschienen in
Series: Working Paper ; No. 0402

Klassifikation
Wirtschaft
Market Structure, Pricing, and Design: Oligopoly and Other Forms of Market Imperfection
Legal Monopolies and Regulation or Deregulation
Thema
infrastructure quality
deregulation
investment incentives
access charges
regulation

Ereignis
Geistige Schöpfung
(wer)
Bühler, Stefan
Gärtner, Dennis
Halbheer, Daniel
Ereignis
Veröffentlichung
(wer)
University of Zurich, Socioeconomic Institute
(wo)
Zurich
(wann)
2005

Handle
Letzte Aktualisierung
10.03.2025, 11:42 MEZ

Datenpartner

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Objekttyp

  • Arbeitspapier

Beteiligte

  • Bühler, Stefan
  • Gärtner, Dennis
  • Halbheer, Daniel
  • University of Zurich, Socioeconomic Institute

Entstanden

  • 2005

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