Price Structure And Network Externalities In The Telecommunications Industry Evidence From Sub-Saharan Africa

Many developing countries have experienced significant developments in their telecommunications network. Countries in Africa are no exception to this. The paper examines what factor facilitates most network expansion using micro data from 45 fixed-line and mobile telephone operators in 18 African co...

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Bibliographic Details
Main Author: Iimi, Atsushi
Format: eBook
Language:English
Published: Washington, D.C The World Bank 2007
Subjects:
Fax
Online Access:
Collection: World Bank E-Library Archive - Collection details see MPG.ReNa
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100 1 |a Iimi, Atsushi 
245 0 0 |a Price Structure And Network Externalities In The Telecommunications Industry  |h Elektronische Ressource  |b Evidence From Sub-Saharan Africa  |c Iimi, Atsushi 
260 |a Washington, D.C  |b The World Bank  |c 2007 
300 |a 43 p. 
653 |a Macroeconomics and Economic Growth 
653 |a Mobile Phone Subscribers 
653 |a E-Business 
653 |a Markets and Market Access 
653 |a International Economics & Trade 
653 |a Penetration Rate 
653 |a Fax 
653 |a Telecommunications Infrastructure 
653 |a Access to Markets 
653 |a Electricity 
653 |a Emerging Markets 
653 |a Mobile Phone 
653 |a Infrastructure Development 
653 |a Debt Markets 
653 |a Private Sector Development 
653 |a International Telecommunication 
653 |a Finance and Financial Sector Development 
653 |a Economic Theory and Research 
653 |a Data 
653 |a Network 
653 |a Mobile Telephone 
700 1 |a Iimi, Atsushi 
041 0 7 |a eng  |2 ISO 639-2 
989 |b WOBA  |a World Bank E-Library Archive 
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520 |a Many developing countries have experienced significant developments in their telecommunications network. Countries in Africa are no exception to this. The paper examines what factor facilitates most network expansion using micro data from 45 fixed-line and mobile telephone operators in 18 African countries. In theory the telecommunications sector has two sector-specific characteristics: network externalities and discriminatory pricing. It finds that many telephone operators in the region use peak and off-peak prices and termination-based price discrimination, but are less likely to rely on strategic fee schedules such as tie-in arrangements. The estimated demand function based on a discreet consumer choice model indicates that termination-based discriminatory pricing can facilitate network expansion. It also shows that the implied price-cost margins are significantly high. Thus, price liberalization could be conducive to development of the telecommunications network led by the private sector. Some countries in Africa are still imposing certain price restrictions. But more important, it remains a policy issue how the authorities should ensure reciprocal access between operators at reasonable cost