An Examination of Market Power in the Intrastate Long‐Distance Telephone Service Markets: Evidence from a Natural Experiment
利用州级面板数据和双重差分法，研究价格放松管制如何改变长途电话运营商的市场行为，并解释受管制与放松管制市场的价格差异。
During the preceding 2 decades, state public utility commissions have experimented extensively with regulating telecommunications carriers. More recently, many states have more or less deregulated long‐distance service. This paper employs a panel data set of states to examine whether the competitive conduct of long‐distance carriers was affected by these events. A methodology is developed to estimate changes in the market conduct parameter following states’ decisions to price deregulate long‐distance service. This effect is isolated by using a difference‐in‐difference estimator that compares the change in market conduct of the treatment group (states deregulated during the study period) to the change in market conduct of the control group (states deregulated throughout the study period). My hypothesis is that elimination of price regulation altered the carriers’ market conduct and that this change in conduct explains, in part, the price differences in regulated and deregulated markets. The results confirm my hypothesis.