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| Seonghoon Jeon |
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| ''Ramsey pricing in one-way and two-way interconnection between telephone networks'' |
| ( 2002, Vol. 12 No.3 ) |
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| I derive Ramsey optimal prices in one-way access of long-distance operators and enhanced service providers to local loops. As long-distance services and enhanced services become substitutes due to the advance of Internet telephony, the Ramsey principle requires higher access charges assessed on both services. I also derive Ramsey prices in two-way interconnection between fixed-link and mobile phone networks, which turn out to be formally equivalent to those for the one-way access above. This result suggests that the price of fixed-to-mobile calls should be higher than the price of mobile-to-fixed calls when the substitutability of calls to double subscribers is more prominent than the substitutability of calls of double subscribers, and vice versa. |
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| Keywords: |
JEL: L5 - Regulation and Industrial Policy: General
L9 - Industry Studies: Transportation and Utilities: General |
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| Manuscript Received : Feb 19 2002 | | Manuscript Accepted : Feb 20 2002 |
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