Welfare Effects of Introducing Competition in the Telecom Sector in Djibouti
Djibouti is very well placed, as a landing site of undersea fiber optic cables, to benefit from the digital economy. However, the prevalence of a single national telecom operator in the country has stifled service delivery and innovation in the tel...
| Main Authors: | , , , |
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| Format: | Working Paper |
| Language: | English |
| Published: |
World Bank, Washington, DC
2019
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| Subjects: | |
| Online Access: | http://documents.worldbank.org/curated/en/284461557256603334/Welfare-Effects-of-Introducing-Competition-in-the-Telecom-Sector-in-Djibouti http://hdl.handle.net/10986/31675 |
| Summary: | Djibouti is very well placed, as a
landing site of undersea fiber optic cables, to benefit from
the digital economy. However, the prevalence of a single
national telecom operator in the country has stifled service
delivery and innovation in the telecom sector. Mobile
broadband coverage and access to internet in Djibouti in
2018 remains below that of many Sub-Saharan African
countries. This paper simulates the impact of the
introduction of competition on the telecom sector's
prices and its implications for households' welfare.
The analysis finds important gains in welfare among current
users of telecom services, with the largest gains going to
the richest households. On the extensive margin, the
analysis also finds a higher likelihood of take up of
telecom services across the consumption distribution but
skewed toward the rich. More work is needed to understand
the implications of changes in the telecom sector,
especially as greater access may lead to more unequal
access, at least in the short term. |
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