Dyad Calling Behavior: Asymmetric Power and Tie Strength Dynamics

We develop a model of dyad calling behavior as the outcome of asymmetric power between the initiating and receiving callers and the strength of their tie. Using a unique mobile phone service dataset, we estimate the model which encapsulates the evolving relationship between pairs of callers. We find that, first, the initiating callers enjoy more power than the receiving callers in determining the call volume. Second, the call volume between a pair of callers increases with the number of their common contacts. Finally, the reciprocity effect is prevalent in mobile phone service consumption. We discuss and demonstrate the implications of our results on firms' telecommunication service pricing decisions.