The Application Of Regulatory Economics In Telecommunication Pricing

Professor Laffont and Professor Tirole founded the New Regulatory economics,by using Game theory, information economics,mechanism designing to analyze regularory problems。The most notable characteristic of New Regulatory economics is to lead the incentive problem into the analysis of the regulatory problem,solve the regulatory problem as an optimal mechanism designing problem。The new technology revolution is deeply changing the traditional telecommunication concept and system。The telecommunication industry is facing a hitherto unknown transform,the pace of opening the market and leading into competition is notably speeding up。The degree of telecommunication regulatory revolution is notably deepened。The telecommunication industry is not natural monopoly industry any longer。Hence the former theory research and policy suggestion based on natural monopoly supposition should be revised。This paper attempts to analyze the price fixing mechanism of the deregulated and competing telecommunication industry。It first analyzes two competing operators'game about the access price,users'calling price,it loosens the equilibrium existence condition:the access price equals the marginal access cost。It proves the equilibrium will exist when the access price is tend to the marginal access cost,and gives the equilibrium solution。It then analyzes the operator's decision under the several operating kinds in the telecommunication market:without receive charge;the regulatory or contracted receive charge;market decided receive charge;the existence of price discrimination。It includes a meaningful result:network based price discrimination may breakdown the interconnection of the networks。...