The Telecommunications Act of 1996 sought to end the monopoly that once existed in the telecommunications industry. Since its adoption, the telecommunications industry has been undergoing a period of rapid change and development. The entry of new players into the market encouraged them to seek new ways to attract and keep customers. These changes have led to a rapid influx of new technology and...

1 Antitrust thinking and enforcement have traditionally been firmly grounded in conventional economic models of monopoly and oligopoly market structures, all fully and inevitably constrained by the " laws " of demand and decreasing returns. The new economics of " digits, " encompassing those goods (like software, books, and music) that are capable of being reduced to 1's and 0's (meaning electr...

This paper suggests that the interaction between consumers has an impact on market structure, in addition to each consumer’s own behavior. In this paper, we replicate the artificial market model proposed by Onozaki and Yanagita, and extend it by adding the network of consumers in order to show that the interaction between consumers in the market affects emerging and changing the market structur...

In this paper we investigate a two-sided market platform model. In the standard framework, firms interact with consumers through one or more platform providers. For example, video game providers (firms) develop games for a gaming console (platform), and end users (consumers) play these games on the console. Consumer utility may depend on the number of other consumers who interact on one side of...

This note seeks to fill a small but significant gap in the literature on monopoly pricing. We ask how an expansion of market demand affects the resulting monopoly price. Specifically, if consumers’ (aggregate) willingness-to-pay increases uniformly by some amount, will the monopoly price increase, and, if so, by how much? It is readily verified that in case of a linear demand curve a uniform sh...

A neglected effect of monopoly is the distortion in the quantity of resources supplied. Monopoly not only affects the economy's output mix, it also results in factor prices that are below social marginal value products. This latter distortion is shown to be quantitatively important when other policies, such as taxes on labor earnings, also depress factor prices. Under plausible conditions, the ...

This paper examines how competition among payment card networks—three-party scheme networks and four-party scheme networks—affects pricing as well as the welfare of various parties. A competing network has an incentive to provide rewards to its card users. By providing more generous rewards than its rival networks, the network can increase its own card transactions because multihoming cardholde...

1.0 Introduction One of the main reasons to undertake sector specific regulation of telecom markets has been the unique characteristics of cost and demand structures within the telecom sector. This chapter examines some general characteristics of cost and demand for telecom services, and on this background discusses how these affect possibilities for creating competitive telecom service markets...

It is well known that competition can destroy incentives to invest in firm-specific relationships. This paper examines how the tension between relationships and competition is resolved in the investment banking market, which for decades has been characterized by both relationships and competition. The model studies the impact on relationships of four different dimensions of competition: non-exc...

We propose a model for the evolution of market share in the presence of social influence. We study a simple market in which the individuals arrive sequentially and choose one of the products. Their decision of which product to choose is a stochastic function of the inherent quality of the product and its market share. Using techniques from stochastic approximation theory, we show that market sh...