Motivated by policy makers' recent interest in reducing switching costs in various network industries to increase competition, this paper investigates how switching costs affect market outcome in such industries. The results show that the effects of switching costs on market concentration and...

This paper investigates firms' decisions to reimburse consumers' switching costs in network industries. Prior literature finds that switching costs incentivize firms to harvest their locked-in consumers rather than price aggressively for market dominance, resulting in a lower market...

We study duopoly pricing in the market for mobile phone service, which features network externalities, switching costs, and consumer heterogeneity. We introduce a steady state approach that enables a tractable analysis without endgame effects. The model can generate a variety of testable...

This paper investigates how switching costs affect product compatibility and market dynamics in network industries. A reduction in the switching cost makes the firms' products more attractive relative to the outside good, which diminishes the market expansion benefit of making products...

In this article I analyze the effects of a recent reform intended to decrease switching costs in the cellular industry. The reform, implemented in Chile in 2012, allowed cell phone users to switch operators without any contract restriction while keeping their wireless number. Its aim was the...

Based on a game theoretical model I previously developed, I present some evidence of the effect of the unlocked-handset policy recently implemented in Peru based on market analysis and reduced form empirical methods using consumer panel data. Average prices declined since mid 2014, and the...

We study firms' choices of compatibility in a dynamic setting. Current compatibility choice shapes the distribution of consumers switching costs and thereby affects competition and compatibility choice in the future. Given today's market shares, the dynamics of compatibility is asymmetric in...

As in most industries, in health care, information is a competitive asset, and we expect that health care providers may have incentive to protect their information from competitors. This study aims to understand how this incentive to protect information may be a barrier to the development of a...

In this article, we estimate the price elasticities of demand for subscription and consumer switching costs for mobile telephony. We use a panel of Portuguese consumer level data to estimate a series of multinomial and mixed logit models. The demand for subscription is elastic. Switching costs...

We compare four approaches to network neutrality and network management regulation in a two-sided market model: (i) no variations in Quality of Service and no price discrimination; (ii) variations in Quality of Service but no price discrimination; (iii) variations in Quality of Service and price...