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| Author: | Hahn, J.-H. |
| Title: | Nonlinear pricing of telecommunications with call and network externalities |
| Journal: | International Journal of Industrial Organization
2003 : SEP, VOL. 21:7, p. 949-967 |
| Index terms: | Telecommunication Networks Pricing |
| Freeterms: | Nonlinear pricing |
| Language: | eng |
| Abstract: | The author investigates how call and network externalities affect a monopolist's optimal nonlinear tariff in a two-way telecommunication service market, where consumers' valuations for outgoing and incoming calls are positively correlated and the firm is not allowed to charge incoming calls. It is shown that, in contrast to the traditional efficiency-on-the-top result, all subscribers including those the highest willingness-to-pay make suboptimal quantities of calls in the equilibrium. |
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