New article by Øystein Foros

3 January 2016 12:51

(updated: 7 September 2017 12:32)

New article by Øystein Foros

The article "Competition for advertisers and for viewers in media markets" by Kjetil Andersson, Øystein Foros and Bjørn Hansen has been published in the Scandinavian Journal of Economics.

The article "Competition for advertisers and for viewers in media markets" by Kjetil Andersson, Øystein Foros and Bjørn Hansen has been published in the Scandinavian Journal of Economics.

Abstract:

The theoretical literature on mobile termination rates (MTRs) is inconclusive on how the level of MTRs affects overall consumer charges and firms' profits. We show that when firms offer bundles with fixed included usage – a tariff structure that has become more common in recent years – an identical change in all MTRs does not affect firms' retail prices or profits. We use a panel dataset from saturated European markets to estimate the effect of MTRs on mobile operators' profits. As predicted by the theoretical model, we cannot reject the fact that firms' profits are unaffected by an identical change in all MTRs.