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題名 Asymmetric Regulation, Price Elasticity of Demand and Congestion
作者 許牧彥
Hsu, Mu -Yen
李淑華
Li, Shu - Hua
貢獻者 科管智財所
關鍵詞 Asymmetric Regulation, Price Elasticity, Telecommunication Industry, Mobile phone service providers
日期 2016-06
上傳時間 17-Apr-2020 16:27:13 (UTC+8)
摘要 Asymmetrical regulation is aimed to limit the price-lift of significant market powers and prevent shrinking of consumer surplus. Therefore, the relevant literature of asymmetrical regulation implicitly neglected the theoretical possibility that firms might lower price to increase revenue when price elasticity of demand are larger than one. By studying a real case of Chung-Hwa Telecom (CHT), the largest mobile phone service providers in Taiwan, we estimated the price elasticity of residual demand faced by CHT and found it is larger than one. Therefore, it is reasonable for CHT to continually lower its price and extended its revenues from 2010 to 2013. Because the cost nature of telecommunication service provider is featured by high fixed costs with low variable costs, firms have the incentive to enlarge revenue and then maximize their profit. Unfortunately, lowered price induced more subscribers to share the limited capacity, then induce congestion of communication channels and reduce the quality of service. Our findings remind all the public utility regulators that price regulation should be coupled with quality control especially when price elasticity of demand is larger than one.
關聯 The 21st ITS(International Telecommunications Society) biennial conference, International Telecommunications Society (ITS)
資料類型 conference
dc.contributor 科管智財所
dc.creator (作者) 許牧彥
dc.creator (作者) Hsu, Mu -Yen
dc.creator (作者) 李淑華
dc.creator (作者) Li, Shu - Hua
dc.date (日期) 2016-06
dc.date.accessioned 17-Apr-2020 16:27:13 (UTC+8)-
dc.date.available 17-Apr-2020 16:27:13 (UTC+8)-
dc.date.issued (上傳時間) 17-Apr-2020 16:27:13 (UTC+8)-
dc.identifier.uri (URI) http://nccur.lib.nccu.edu.tw/handle/140.119/129285-
dc.description.abstract (摘要) Asymmetrical regulation is aimed to limit the price-lift of significant market powers and prevent shrinking of consumer surplus. Therefore, the relevant literature of asymmetrical regulation implicitly neglected the theoretical possibility that firms might lower price to increase revenue when price elasticity of demand are larger than one. By studying a real case of Chung-Hwa Telecom (CHT), the largest mobile phone service providers in Taiwan, we estimated the price elasticity of residual demand faced by CHT and found it is larger than one. Therefore, it is reasonable for CHT to continually lower its price and extended its revenues from 2010 to 2013. Because the cost nature of telecommunication service provider is featured by high fixed costs with low variable costs, firms have the incentive to enlarge revenue and then maximize their profit. Unfortunately, lowered price induced more subscribers to share the limited capacity, then induce congestion of communication channels and reduce the quality of service. Our findings remind all the public utility regulators that price regulation should be coupled with quality control especially when price elasticity of demand is larger than one.
dc.format.extent 861055 bytes-
dc.format.mimetype application/pdf-
dc.relation (關聯) The 21st ITS(International Telecommunications Society) biennial conference, International Telecommunications Society (ITS)
dc.subject (關鍵詞) Asymmetric Regulation, Price Elasticity, Telecommunication Industry, Mobile phone service providers
dc.title (題名) Asymmetric Regulation, Price Elasticity of Demand and Congestion
dc.type (資料類型) conference