|
on Regulation |
| By: | Gambarin, Monica; Houpis, George; Rodríguez, José María; Ovington, Tom; Santamaría, Juana |
| Abstract: | Now that the Digital Markets Act (DMA) will soon be implemented, different policy options can be considered, each presenting some trade-offs. In this paper we discuss the importance of taking into account proportionality when designing the specific remedies to implement the DMA. As the DMA leaves some room for different implementation options, taking into account proportionality, via an explicit framework, may help to assess the options that best accomplish the ultimate goals established in the DMA (i.e. promoting innovation, quality, fair and competitive prices and choice for end users). The proportionality framework we develop applies the principles behind telecoms regulation to horizontal interoperability in number-independent interpersonal communications services. This is the obligation set out in Article 7 in the DMA. We find that, when analysing a set of options for policy implementation through proportionality lenses, outcomes may vary considerably compared to when proportionality is neglected. |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:itse23:277961&r=reg |
| By: | Khemakongkanonth, Chate; Srinuan, Pratompong |
| Abstract: | In the past decades, Thailand's telecommunication market has accommodated 3 dominant providers ranked by subscribers, namely AIS, TRUE, and DTAC, along with one minor government-owned provider NT. In 2021, TRUE and DTAC requested to merge, which was eventually approved by the national regulatory agency in 2022. The 3-to-2 merger here is likely to be more impactful onto the market than more typically seen 4-to-3 mergers. This paper estimates post-merger changes in prices and whether possible efficiency gained due to the merger would be sufficient to deter the mergers from raising their prices. By using time series data on pre-paid and post-paid subscribers of the major three operators, a merger simulation was employed. The proxy for price used in the simulation was average revenue per user divided by minute of use. The simulation assumed that collusion levels between the 3 operators before and after the merger mirror HHIs, and set the level of efficiency gain at 10%. The result showed a 12.95% increase in market price on average. Upward pricing pressure, under a similar setup, indicated a 7.19% increase in average market price. The result justified retail tariff regulation to limit the negative impact on consumers. |
| Keywords: | Mobile telecommunications, Merger simulation, Upward pricing pressure, Demand estimation, Thailand |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:itse23:277986&r=reg |
| By: | Bougette, Patrice; Budzinski, Oliver; Marty, Frédéric |
| Abstract: | Mergers and acquisitions shape industry competition. Effective merger remedies are important for market efficiency and consumer welfare. This paper explores the need for more flexible remedies to address changing markets after mergers. While the EU permits some flexibility with less restrictive remedies, we conceptually advance the design elements of a dual-phase, bifurcated merger control system. This system integrates ex-ante processes with more systematic and comprehensive ex-post measures. Such an approach can address the shortcomings of the current system and, consequently, holds the potential to enhance merger control in dynamic markets. |
| Keywords: | merger remedies, competition authorities, market dynamics, dynamic competition, oligopolies, innovation effects, European Union |
| JEL: | L41 K21 L13 |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:tuiedp:181&r=reg |
| By: | Jeanjean, François |
| Abstract: | This article studies the impact of the sharing of traffic costs between an Internet access provider and a content provider, both of which have a monopoly on their market. It shows that when the content provider charges consumers for content, cost sharing triggers a virtuous circle that incentivizes the content provider to reduce its traffic, which lowers prices for the end consumer and thus increases, not only the consumers surplus but also the profits of the ISP as well as to some extent, those of the content provider. When the content provider chooses an ad-business model, if it charges at ad-level, the cost sharing also favors consumers surplus and in a wide range of cases, the total surplus. If it charges at content level, the result is always favorable to consumers provided, however, that content provider is able to sufficiently monetize ads. The results are robust to different billing modes for traffic, pay-per-use or flat rate. |
| Keywords: | Telecommunication, fair share, cost sharing |
| JEL: | D61 L11 L86 |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:itse23:277978&r=reg |
| By: | Whalley, Jason; Stocker, Volker |
| Abstract: | This paper explores the changing nature of universal service. In particular, it looks at universal service obligations within the United Kingdom and the role that public call boxes play within the context of a vibrant mobile telecommunications market with extensive geographical coverage and widespread usage. Our analysis draws on data from the 2021consultation by Ofcom into the scope of the UK's universal service obligations to highlight their complex nature. Although the number of public call boxes has dramatically fallen in recent years, not least because of the growth in mobile phone usage, they still perform a vital socio-economic role. This role complicates their replacement, creating economic inefficiency but social value. The latter limits the ability of stakeholders - regulators and mobile operators - to radically amend how the universal service obligation is provided. |
| Keywords: | Public call boxes, universal service obligations, consultation, UK |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:itse23:278022&r=reg |
| By: | José Ignacio Heresi |
| Abstract: | Several antitrust authorities have investigated platform price parity clauses around the world. I analyze the impact of these clauses when platforms design a search environment for sellers and buyers to interact. In a model where platforms choose the unitary search cost faced by consumers, I show when it is profitable for platforms to obfuscate consumers through high search costs. Then, I show that price parity clauses, when exogenously given, can increase or reduce obfuscation, prices, and consumer surplus. Finally, when price parity clauses are endogenous, they are only observed in equilibrium if they hurt consumers. JEL Classifications: D83, L42, L81. Key words: consumer search, obfuscation, platforms, price parity clauses. |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:edj:ceauch:350&r=reg |
| By: | Frias, Zoraida; Lehr, William; Stocker, Volker; Mendo, Luis |
| Abstract: | Mobile broadband networks constitute essential infrastructure to enable a wide range of innovative services and use cases anticipated for our digital economy future. Measuring performance is essential in many ways. First, to allow service providers to manage and develop their networks. Second, for the efficient operation of markets, and third, for evidence-based policymaking. In the rapidly evolving digital economy, capabilities for collecting more fine-grained measurements and analytics that deliver insights to enable real-time network management and localized control are expanding. As the fundamental methods used to collect measurement data are changing, the ecosystem of stakeholders with strategic interests in mobile measurement is growing and becoming more complex, posing challenges and opportunities for policymakers. Against the background of this growing complexity, this paper aims to discuss some basic features of a capable and reliable measurement ecosystem for mobile broadband. We document how the mobile broadband measurement ecosystem has changed and discuss its implications on a number of important broadband policy issues. |
| Keywords: | Mobile Broadband, Measurement, Performance, Evidence-based policymaking, Internet Policy, Telecommunications Policy |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:itse23:277959&r=reg |
| By: | Gisca, Oxana; Matinmikko-Blue, Marja; Ahokangas, Petri; Gordon, Jillian; Yrjölä, Seppo |
| Abstract: | Local cellular mobile communication networks have evolved as a novel concept and deployment model, and a prerequisite for their future emergence is the radio spectrum, which is a scarce resource. Regulatory approaches are expanding at the national, regional, and international levels making legitimacy of the local 5G and future 6G mobile communication networks an existing multi-faceted consideration. This paper provides an analysis of the regulatory approaches taken by national regulatory authorities (NRA) considering local 5G mobile communication networks. The focus is the European level, with Finland and UK as case examples. The article applies business model thinking to the regulatory realm of local mobile communication networks in Europe as an approach to the legitimacy considerations identified. The paper paves way to a new perspective for understanding and developing regulatory approaches and advancing sound and efficient regulatory actions. |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:itse23:277966&r=reg |
| By: | Jamison, Mark A.; Wang, Peter |
| Abstract: | We examine broadband's impacts on entrepreneurship, income, and employment in general and separately by gender and for whites versus minorities in the U.S. for 2000 - 2019. Using Current Population Surveys and matching, we find that broadband access significantly impacted the decision to be self-employed until at least 2012. Broadband access also reduced unemployment and increased earnings. It generally benefitted women and minorities more than men and whites, but not always. Broadband was particularly effective for minority males and females during the years up to and immediately following the Great Recession. These findings are consistent with the idea that broadband may dampen gender and racial bias. The effects of broadband generally diminish as adoption increases, consistent with the belief that late adopters benefit less than early adopters. |
| Keywords: | broadband, entrepreneurship, discrimination, income, unemployment |
| JEL: | L86 L26 J71 L53 |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:itse23:277974&r=reg |
| By: | Jamison, Mark A.; Tęcza, Jakub; Wang, Peter |
| Abstract: | We study the competition effects of platforms entering their own marketplaces in the context of mobile applications. Using a rich panel dataset of monthly observed applications on the most prominent mobile ecosystems, Apple and Android, we seek to understand how the launch of a new application by the platform owner affects consumers and third-party developers (developers). We find evidence that Apple's efforts have positive effects on developers and encourage innovation. But on the Android platform, introduction of a Google app decreases the number of users for developers' apps. This is likely a substitution effect rather than suppression as developers do not decrease their expansion on the Android platform. In general, we find evidence of platform vertical integration having positive impacts for consumers and developers, and only quite weak evidence of suppression. |
| Keywords: | Platforms, competition, vertical integration, regulation, self-preferencing |
| JEL: | L86 L51 K21 |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:itse23:277975&r=reg |
| By: | El Hadi Caoui; Andrew Steck |
| Abstract: | This paper documents the role that content providers play upstream in the global internet supply chain. Using novel data, we establish three stylized facts: (1) Content providers have become the largest buyers of bandwidth capacity, their share of global used bandwidth has grown dramatically (from 5% to 69%) over the period 2005-2021, with important heterogeneity across regions. (2) Content providers (in particular, Amazon, Google, Meta, and Microsoft) are vertically integrating into the provision and operation of internet infrastructure, accounting for an increasingly important share of investment in internet cable infrastructure. (3) The growth in content providers' demand is in part associated with the roll-out of their data centers globally and corresponding increase in inter-data center traffic; their investment in private cables is in part driven by data center siting, which are in locations that may lack connectivity to public internet cables. We discuss implications of these trends for innovation, internet traffic transparency, technology standard adoption, and network resilience. |
| Keywords: | internet backbone, content providers, bandwidth market, vertical integration |
| JEL: | L13 L96 L86 |
| Date: | 2023–09 |
| URL: | http://d.repec.org/n?u=RePEc:net:wpaper:2307&r=reg |
| By: | Imke Reimers; Joel Waldfogel |
| Abstract: | Regulators are responding to growing platform power with curbs on platforms' potentially biased exercise of power, creating urgent needs for both a workable definition of platform bias and ways to detect and measure it. We develop a simple equilibrium framework in which consumers choose among ranked alternatives, while the platform chooses product display ranks based on product characteristics and prices. We define the platform's ranks to be biased if they deliver outcomes that lie below the frontier that maximizes a weighted sum of seller and consumer surplus. This framework leads to two bias testing approaches, which we compare using Monte Carlo simulations, as well as data from Amazon, Expedia, and Spotify. We then illustrate the use of our structural framework directly, producing estimates of both platform bias and its welfare cost. The EU's Digital Services Act's provision for researcher data access would allow easy implementation of our approach in contexts important to policy makers. |
| JEL: | L40 L81 |
| Date: | 2023–10 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:31766&r=reg |
| By: | Thomas Benison (Motu Economic and Public Policy Research); Julia Talbot-Jones (Victoria University of Wellington) |
| Abstract: | With urbanisation and climate change placing increasing pressure on water security around the world, demand-side mechanisms, such as metering and pricing, have emerged as core components of urban water management. Yet the impacts of metering and pricing on water production and consumption in Aotearoa New Zealand are not well understood. This constrains the ability of decision-makers to make targeted wellbeing improvements for the communities they serve. In this paper, we endeavour to estimate the impact of metering and pricing on urban water consumption in Aotearoa. We collect data on residential water production and consumption from 67 local councils and provide comparisons of water use across regions and over time, with particular attention given to Tauranga and Wellington. Our experience reveals the extent of the drinking water data gaps in urban areas in Aotearoa, raising questions about how evidence is being used to inform the design of urban water policy in Aotearoa and issues of public accountability. |
| Keywords: | Data gaps; demand management; drinking water; metering; policy; pricing |
| JEL: | Q21 Q25 Q28 |
| Date: | 2023–10 |
| URL: | http://d.repec.org/n?u=RePEc:mtu:wpaper:23_09&r=reg |
| By: | Pérez Urdiales, María; Libra, Jesse Madden; Machado, Kleber; Serebrisky, Tomás; Solís, Ben |
| Abstract: | An issue that affects the effectiveness of water pricing policies is consumers misperception, which implies that households decide their water consumption based on poor/inaccurate information about the marginal price. We use household survey data on bill and quality perception in Brazil to analyze this problem and its drivers. Once we control for the selection bias caused by survey respondents voluntarily providing their bill, we find evidence of bill misperception. Apart from the informational and socioeconomic drivers usually considered in the literature, perceived water quality seems to be a relevant factor of the degree of misperception. |
| JEL: | Q25 |
| Date: | 2022–05 |
| URL: | http://d.repec.org/n?u=RePEc:idb:brikps:12212&r=reg |
| By: | Kortelainen, Mika; Markkanen, Jaakko; Siikanen, Markku; Toivanen, Otto |
| Abstract: | Quasi-experimental evidence on the effectiveness of price regulation policies in curbing pharmaceutical expenditure is scarce. We analyze widely utilized generic substitution and reference price policies using data from the Nordic countries. Constructing treatment and control groups by matching data across countries by active ingredients and employing difference-in-difference methods on market-level observations, we find that expenditure per dose decreases by 40% moving from the laxest to the strictest regime. Prices decrease less: Reallocation of demand to cheaper products likely explains the difference. We find no adverse effects on pharmaceutical availability and non-existent or positive quantity effects. |
| Keywords: | pharmaceutical expenditure, pharmaceutical pricing, generic competition, reference pricing, regulation, Local public finance and provision of public services, I11, I18, H51, L51, L65, C23, fi=Elinkeinopolitiikka|sv=Näringspolitik|en=Industrial and economic policy|, fi=Terveyspalvelut|sv=Hälsovårdstjänster|en=Healthcare services|, |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:fer:wpaper:157&r=reg |
| By: | Joan Calzada; Nestor Duch-Brown; Ricard Gil |
| Abstract: | Search engines are important access channels to news content of traditional newspapers with Google alone responsible for 35% of online visits to news outlets in the European Union. Yet, the effects of Google Search on market competition and information diversity have received scant attention. Using daily traffic data for 606 news outlets from 15 European countries, we analyze Google’s capacity to influence organic search visits by exploiting exogenous variation in news outlets’ indexation caused by nine core algorithm updates rolled out by Google between 2018 and 2020. We find Google core updates overall reduced the number of keywords (queries) for which news outlets occupy one of the top 10 organic search results positions. Therefore, given the positive impact that the number of top keywords have on traffic this led to the decrease in the overall number of news outlets’ visits. Finally, when studying the impact of Google core updates on media market concentration, we find the three “big” core updates identified in this period reduced market concentration by 1%, but this effect was offset by the rest of the updates. Similarly, in the context of Spain, we find the three “big” core updates reduced monthly keyword concentration by 4%. |
| Keywords: | search engines, market concentration Google, news sites, Europe |
| JEL: | D43 L50 L82 M31 |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_10671&r=reg |
| By: | Weiss, Mariana; Chueca, J. Enrique; Jacob, Jorge; Gonçalves, Felipe; Azevedo, Marina; Gouvêa, Adriana; Ravillard, Pauline; Carvalho Metanias Hallack, Michelle |
| Abstract: | Los avances masivos de la digitalización han hecho que los programas de Respuesta a la demanda (RD) en el sector residencial sean factibles; sin embargo, la mayoría de los hogares en la región de América Latina y el Caribe (ALC) no conocen esta clase de programas. En este informe, los autores exploran experimentos sobre la disposición de los consumidores residenciales a adoptar RD para reducir sus facturas. Los autores analizan la probabilidad de que los hogares de ingresos bajos y medios en 11 países de ALC adopten un plan de RD. Los cuestionarios contaron con explicaciones sobre los propósitos y beneficios de los programas de RD. Los autores también analizaron la clase de tecnología de comunicación a la que es más probable que los consumidores respondan. La mayoría de los entrevistados entendieron que sería justo tener tarifas de horas pico y horas valle para cubrir los costos de suministro. En tres de los cinco casos analizados, más del 50% de los entrevistados optaron por pasarse a un plan de RD. Esos fueron el caso de los programas de RD con una meta de ahorro pico y un descuento preacordado, y el control del calentador o aire acondicionado por parte de la empresa de servicios públicos durante las horas pico. Los resultados sugieren que los diseñadores de políticas deberían comenzar a considerar los programas de respuesta a la demanda como una herramienta para aumentar la asequibilidad de los servicios de electricidad para los consumidores residenciales. Para eso, es importante considerar también la curva de aprendizaje que se requerirá de los usuarios, proveedores de servicios y reguladores. |
| JEL: | O54 Q40 Q41 Q42 Q48 Q43 |
| Date: | 2022–03 |
| URL: | http://d.repec.org/n?u=RePEc:idb:brikps:12133&r=reg |
| By: | Yu, Hongwei; Chen, Wenjin; Wang, Xinyi; Delina, Laurence; Cheng, Zhiming; Zhang, Le |
| Abstract: | We employ a regression discontinuity design (RDD) to investigate the causal effect of China's Energy Conservation Law (ECL) on the energy efficiency of Chinese firms. Using data from the 2018 China Employer-Employee Survey (CEES), we find that the energy regulation has a positive impact on enterprise energy efficiency. Furthermore, we observe that the effects of the regulation vary across industries, ownership types, and firm ages. We also find that energy management system (EnMS) and technological innovation are mechanisms through which the energy regulation helps improve enterprise energy efficiency. These findings underscore the importance of well-designed and effectively implemented energy regulations in fostering energy efficiency and reducing carbon emissions in the industrial sector. They also highlight the need to consider the heterogeneity of the regulatory impact when designing energy-saving policies. |
| Keywords: | Energy Conservation Law, energy regulation, energy efficiency, China, regression discontinuity design |
| JEL: | K32 Q56 Q58 |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:glodps:1339&r=reg |