Abstract
We examine co-investment and access in a model of new network deployment. We show that the incumbent firm may find it optimal to deter co-investment by over-investing when the cost-sharing rule is based on its verified expenditure and the information on the deployment cost is asymmetric between the operators and the regulator. When partial deterrence is optimal, it occurs in the areas of intermediate attractiveness, consistently with the evidence found in other industries. A necessary and sufficient condition for deterrence to occur is that local industry profits are lower with than without co-investment. Results are robust to demand uncertainty.
Sign-in/Register to access full text options 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
