Article ID | Journal | Published Year | Pages | File Type |
---|---|---|---|---|
5075976 | Information Economics and Policy | 2010 | 14 Pages |
Abstract
I develop a structural demand model for mobile telephony that facilitates the identification of network effects and inter-network compatibility. Network effects are measured as the dependence of consumer willingness to pay on the installed base of subscribers, compatibility as the relative extent of cross- and own-network effects. Estimating the model using quarterly panel data from the Polish mobile telephone market for the period 1996-2001, I find strong network effects and, despite full interconnection of the mobile telephone networks, low compatibility. I also show that ignoring network effects leads to overestimation of demand elasticity.
Related Topics
Social Sciences and Humanities
Business, Management and Accounting
Management of Technology and Innovation
Authors
MichaÅ Grajek,