Competition and subsidies in the deregulated US local telephone industry
研究了美国1996年电信法开放本地电话市场后，不同补贴政策对鼓励新企业进入、减少垄断的效果，发现补贴小市场更划算，但只补贴低成本企业不如无差别补贴有效。
The 1996 Telecommunications Act opened the monopolistic US local telephone industry to new entrants. However, substantial entry costs have prevented some markets from becoming competitive. We study various subsidy policies designed to encourage entry. We estimate a dynamic entry game using data on potential and actual entrants, allowing for heterogeneous option values of waiting. We find that subsidies to smaller markets are more cost effective in reducing monopoly markets, but subsidies to only lower‐cost firms are less cost effective than a nondiscriminatory policy. Subsidies in only early periods reduce the option value of waiting and accelerate the arrival of competition.