An econometric assessment of telecommunications prices and consumer surplus in Mexico using panel data
Author(s)Hausman, Jerry A.; Ros, Agustin J.
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We analyze telecommunications prices in Mexico by using a panel data of countries similar to Mexico to estimate demand models for mobile and fixed-line telecommunications. We find that Mexico’s actual mobile and fixed-line prices are below the predicted prices based on similar countries’ prices. Mexican consumers are paying lower prices than what one would expect based on comparisons of comparable countries. We calculate that in 2011 Mexican consumers received at least $4–$5 billion (USD) in consumer surplus from these lower mobile prices and in 2010 they received over $1 billion (USD) in consumer surplus from these lower fixed-line prices. These findings are in contrast to the general perception that concentrated telecommunications markets in Mexico are resulting in high prices and harming consumers.
DepartmentMassachusetts Institute of Technology. Department of Economics
Journal of Regulatory Economics
Springer Science+Business Media
Hausman, Jerry A., and Agustin J. Ros. "An econometric assessment of telecommunications prices and consumer surplus in Mexico using panel data." Journal of Regulatory Economics 43:3 (June 2013), pp. 284-304.
Author's final manuscript