Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/76245
Authors: 
Buehler, Stefan
Schmutzler, Armin
Benz, Men-Andri
Year of Publication: 
2002
Series/Report no.: 
Working Paper, Socioeconomic Institute, University of Zurich 0209
Abstract: 
We investigate how various institutional settings affect a network provider's incentives to invest in infrastructure quality. Under reasonable assumptions on demand, investment incentives turn out to be smaller under vertical separation than under vertical integration, though we also provide counter-examples. The introduction of downstream competition for the market can sometimes improve incentives. With suitable non-linear access prices investment incentives under separation become identical to those under integration.
Subjects: 
investment incentives
networks
quality
vertical externality
JEL: 
D42
L22
L43
L92
Document Type: 
Working Paper

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