This paper surveys the recent literature on competition between mobile networks in the presence of call externalities and network effects. It argues that the regulation of mobile termination rates based on fully allocated costs, or long-run incremental cost plus," exacerbates the network effects...

This paper reviews the small but growing economic literature on network neutrality. It considers a number of possible departures from network neutrality, in particular termination fees, second-degree price discrimination, and vertical foreclosure.

We examine the evidence available on the efficacy of demand-side programs intended to stimulate broadband adoption. We review studies that attempt to measure results. Our suggestions for future program evaluations are to include cost-benefit analysis as a standard part of program review and to...

This short article explains why merchants accept expensive payment cards when merchants are Cournot competitors. The same acceptance rule as the Hotelling price competition model of Rochet and Tirole (2002) is derived. Unlike the models used in the existing literature, in the Cournot setting...

This paper derives an optimal allocation rule (?*) that (i) assigns a share of the transaction price to the buyer-side of the two-sided market; (ii) is equivalent to the Rochet-Tirole price structure rule; and (iii) is a function of the own/cross-price elasticities. For linear demands, demand...

We consider a model of Internet interconnection. We characterize the Myerson value as the bargaining outcome in interconnection agreements in given networks and provide its interpretation in terms of "betweenness centrality." Then, in an extended network formation model, we characterize the...

The FCC is currently considering whether it should adopt a uniform rate for pole attachment services for broadband services. Based on Ramsey pricing principles, we find that while historical differences in rates were sensible, technological convergence dictates that broadband providers should...

Structural and functional separation of telecommunications operators is being considered in many parts of the world following the U.K. functional separation of BT into retail and network operations. The attractiveness of separation is understandable due to the problems regulators often...

Previous authors have suggested inviting competition as a solution to the credibility issues that arise when a new network good is introduced. We suggest an alternative remedy of pre-producing the good. The two strategies are compared, as are combinations of these two strategies in two different...

Platform businesses add value by facilitating interactions between customers who are attracted in part by network externalities. Two-sided platform businesses with low costs of reversing participation status have become more important with the rise of the Internet. This essay is concerned with...