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Title: Geographic Access Rules and Investments

Author(s): Marc Bourreau, Carlo Cambini and Steffen Hoernig

Publication Date: June 2012

Keyword(s): geographical access regulation, infrastructure investment and Next generation networks

Programme Area(s): Industrial Organization

Abstract: We analyze competition between vertically integrated infrastructure operators that provide access in different geographical areas. A regulator may impose a uniform access price, set local access rates, or deregulate access locally. We analyze the impact of these alternative regulatory regimes on network investments. While cost-based access leads to both suboptimal rollout and duplication, uniform access prices bring too much duplication. Deregulation in competitive areas can spur investment and lead to social optimum, or call for continued regulatory intervention, depending on the resulting wholesale equilibrium.

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Bibliographic Reference

Bourreau, M, Cambini, C and Hoernig, S. 2012. 'Geographic Access Rules and Investments'. London, Centre for Economic Policy Research. https://cepr.org/active/publications/discussion_papers/dp.php?dpno=9013