Prices and price-cost margins of mobile voice services

Title:  ''Prices and Price-cost Margins of Mobile Voice Services'' ¹

Authors:

• Ricardo Cabral (Universidade da Madeira)
• Corrado Andini (Universidade da Madeira)
• Henry Chappell (University of South Carolina, USA)

Date: September 2006

Summary: This paper examines the determinants of prices and price-cost margins for an international sample of 177 mobile voice operators in 45 countries over the 1999-2004 period. In markets for mobile voice services, it is likely that firms with large market share have substantial market power and higher prices and price-cost margins than fringe firms do. In fact, our empirical analysis shows that market share has a positive and significant impact on prices and margins, after controlling for market characteristics and country and time effects. However, we find no relationship between market share and prices for firms with large market share. Finally, high price and high margin firms respond more similarly and less pronouncedly to an increase in market share than low price and low margin firms.

 
¹ This study, including its presuppositions and conclusions, is the exclusive responsibility of its authors and does not necessarily represent or is in any way binding upon the position of ANACOM.

Consult:

• Seminar Programme ''Prices and Price-cost Margins of Mobile Voice Services'' https://www.anacom.pt/render.jsp?contentId=402140