Geographic Access Rules and Investments
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"Geographic Access Rules and Investm..." refers background in this paper
...The reason is that the access-providing incumbent becomes a less aggressive competitor, which is due to the "fat-cat effect" (Fudenberg and Tirole, 1984) or "softening effect" (Bourreau et al., 2011)....
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"Geographic Access Rules and Investm..." refers background in this paper
...Investment in broadband infrastructure is receiving extraordinary attention both from governments and regulators all over the world, due to the significant impact of high-speed access on economic growth (Czernich et al. 2011)....
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...Investment in broadband infrastructure is drawing extraordinary attention from governments and regulators all over the world, due to the significant impact of high-speed access networks on economic growth (Czernich et al., 2011). While regulatory intervention must create conditions that encourage (or rather, do not discourage) infrastructure investment, it should at the same time prevent the monopolization of the retail market for high-speed broadband services. The latter calls for some form of regulated access to infrastructures, while the former implies that this should be done with care. An added complication is that competition among high-speed broadband networks is likely to emerge only in specific regions of a country, mostly in very dense metropolitan areas, while in the rest of the country infrastructure competition will probably not materialize. For the least densely populated areas, only government subsidies will make private investment viable. But even in areas covered without the need for public subsidies, the number of operators rolling out their network will differ. Large swathes of the country will most likely be left with only one high-speed network, while urban areas might be covered by two or more. From a regulatory point of view, this calls for ex-ante access rules to vary across areas characterized by different degrees of infrastructure competition. While this is plausible from the point of view of competition law now popular in telecommunications regulation, there is a lack of theoretical research on this type of access regime and its impact on firms’ investment decisions. The aim of this paper is to fill this gap. Our paper is motivated by recent decisions by the European Commission that forcefully push for the adoption of geographically differentiated remedies, or "geographical access rules" as they are referred to by policy makers (see e.g. ERG, 2008).1 The 2009/140/EC Directive ("Better Regu(1)The association of European Telecom Regulators (ERG, 2008) provides a list of criteria to assess the homogeneity of competitive conditions in different geographical markets and to define geographical access remedies. Xavier and Ypsilanti (2011) analyze the practical complexity of geographically segmented regulation....
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...Investment in broadband infrastructure is drawing extraordinary attention from governments and regulators all over the world, due to the significant impact of high-speed access networks on economic growth (Czernich et al., 2011)....
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720 citations