Scandinavian Working Papers in Economics

Discussion Papers,
Norwegian School of Economics, Department of Business and Management Science

No 2012/10: Empirical evidence on the relationship between mobile termination rates and firms’ profit

Kjetil Andersson (), Øystein Foros () and Bjørn Hansen ()
Additional contact information
Kjetil Andersson: Dept. of Economics and Business Administration, University of Agder, Postal: University of Agder, Department of Economics and Business Administration, Post Box 422, NO-4604 Kristiansand, Norway
Øystein Foros: Dept. of Finance and Management Science, Norwegian School of Economics and Business Administration, Postal: NHH , Department of Finance and Management Science, Helleveien 30, N-5045 Bergen, Norway
Bjørn Hansen: Telenor Research and Innovation (R&I), Postal: Telenor Research and Innovation (R&I)

Abstract: The comprehensive theoretical literature on mobile termination rates (MTRs) is inconclusive on how the level of MTRs affects overall consumer charges and firms’ profit. In a theoretical model, well suited for econometric implementation, we show that where consumers buy a bundle with included usage, as we now observe in the market, the level of MTRs has no impact on retail prices and firms’ profit. We use a panel data set from saturated European markets and find that an identical change in MTRs does not have a significant impact on firms’ profit.

Keywords: Mobile termination rates; consumer charges; firms’ profit

JEL-codes: C23; L21; L51; L96

28 pages, August 28, 2012

Full text files

164204 PDF-file 

Download statistics

Questions (including download problems) about the papers in this series should be directed to Stein Fossen ()
Report other problems with accessing this service to Sune Karlsson ().

This page generated on 2024-02-05 17:12:53.