Terms Of Market Outcomes Research Articles

Spectrum Flexibility and Mobile Development

In this paper we study the effects on mobile market outcomes from three specific attributes linked to a flexible spectrum policy: the presence of a secondary market for spectrum trading, a technological neutrality approach, and the possibility of conducting sharing agreements among operators. In terms of market outcomes, we identify four possible variables: capital investment, network coverage, service pricing, and adoption. After designing a precise causal approach linking the above-mentioned variables, we were able to identify a significant impact on the four independent variables from the spectrum policies. When those three policies are jointly adopted, mobile capital investment is 35.9% larger than when that is not the case. In addition, promoting these policies can increase network coverage by 9.8% after two years, bring down mobile broadband prices by -5.8%, and increase mobile broadband unique subscribers’ penetration by 0.9%. When we consider a wider period of 5-years, dynamic effects take over, resulting in mobile broadband prices being reduced in -14.3% and mobile broadband unique subscribers’ penetration potentially increasing in 2.4%. These results were verified to be robust after the addition of control variables and when controlling for potential endogeneities associated to these causal frameworks. In sum, we believe, based on this evidence, that a flexible approach towards spectrum management that allows for secondary trading, technological neutrality and network sharing can contribute significantly to the development of the mobile sector, thereby maximizing socioeconomic welfare.

The Institutional Justice of the Market Process: Entrepreneurship, Increasing Returns, and Income Distribution.

We argue in this chapter that the transformation in the vision of economics from one in terms of processes to one in terms of equilibrium would in turn yielded public policy implications regarding the role of government and distributive justice. Although classical political economists had made a case regarding the institutional justice of the market process, this argument became overshadowed in the late 19th century and early 20th century by early neoclassical economists, who defended the market in terms of the equilibrium pricing of factor payments. Justice according to the early neoclassical economists was defined in terms of market outcomes that approximate the marginal valuation of the productive contribution of each factor of production. The persistence of this equilibrium paradigm today, among both proponents and critics of the market, has led to the notion that income equality is a substitute, not a complement to economic prosperity.