Fixed-Mobile Call Substitution: Evidence from Korean Long-Distance Markets

27 Pages Posted: 6 Nov 2003

See all articles by Nakil Sung

Nakil Sung

University of Seoul - Department of Economics

Date Written: 2003

Abstract

As mobile telephone services experienced revolutionary growth in most countries throughout the world, they began to compete with fixed telephone services, first for use and then for access. This paper attempts to provide empirical evidence on fixed-mobile substitution by applying an econometric model of fixed telephone toll demand to Korean regional panel data. The time span encompassed by the study, 1993-1997, corresponds to the early development stage of mobile services in Korea. The study clearly shows that mobile calls were substitutes for toll calls even in these early years. My demand model is distinct from existing ones in that it does not consider only network and call externalities but also incorporates an implicit price for face-to-face interactions. Also, the study is relevant to some important public policy issues.

JEL Classification: D12, L96

Suggested Citation

Sung, Nakil, Fixed-Mobile Call Substitution: Evidence from Korean Long-Distance Markets (2003). Available at SSRN: https://ssrn.com/abstract=448680 or http://dx.doi.org/10.2139/ssrn.448680

Nakil Sung (Contact Author)

University of Seoul - Department of Economics ( email )

90 Cheonnong-dong, Dongdaemun-gu
Seoul, 130-743
Korea
82-2-2210-2180 (Phone)
82-2-2210-5232 (Fax)

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