Pricing Dynamics of Network Utilities in Developing Countries

This paper examines the pricing of a utility with an underdeveloped network facing a competitive fringe, short-run network adjustment costs, theft of service, and the threat of retaliatory government intervention that is increasing with the price it charges. Under a variety of plausible assumptions...

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Main Authors:	Chisari, Omar, Kessides, Ioannis N.
Format:	Journal Article
Language:	EN
Published:	2012
Subjects:	Network Formation and Analysis: Theory D850 Transactional Relationships Contracts and Reputation Networks L140 Utilities: General L970
Online Access:	http://hdl.handle.net/10986/5524

id	okr-10986-5524
recordtype	oai_dc
spelling	okr-10986-55242021-04-23T14:02:22Z Pricing Dynamics of Network Utilities in Developing Countries Chisari, Omar Kessides, Ioannis N. Network Formation and Analysis: Theory D850 Transactional Relationships Contracts and Reputation Networks L140 Utilities: General L970 This paper examines the pricing of a utility with an underdeveloped network facing a competitive fringe, short-run network adjustment costs, theft of service, and the threat of retaliatory government intervention that is increasing with the price it charges. Under a variety of plausible assumptions (in the context of developing countries) the utility will find its long-run profits enhanced if it exercises pricing restraint in the early stages of network development. These findings provide some useful insights for the design of post-privatization regulatory governance in developing countries where years of price controls have contributed to choking off investment in network expansion. 2012-03-30T07:33:15Z 2012-03-30T07:33:15Z 2009 Journal Article Review of Network Economics 14469022 http://hdl.handle.net/10986/5524 EN http://creativecommons.org/licenses/by-nc-nd/3.0/igo World Bank Journal Article
repository_type	Digital Repository
institution_category	Foreign Institution
institution	Digital Repositories
building	World Bank Open Knowledge Repository
collection	World Bank
language	EN
topic	Network Formation and Analysis: Theory D850 Transactional Relationships Contracts and Reputation Networks L140 Utilities: General L970
spellingShingle	Network Formation and Analysis: Theory D850 Transactional Relationships Contracts and Reputation Networks L140 Utilities: General L970 Chisari, Omar Kessides, Ioannis N. Pricing Dynamics of Network Utilities in Developing Countries
relation	http://creativecommons.org/licenses/by-nc-nd/3.0/igo
description	This paper examines the pricing of a utility with an underdeveloped network facing a competitive fringe, short-run network adjustment costs, theft of service, and the threat of retaliatory government intervention that is increasing with the price it charges. Under a variety of plausible assumptions (in the context of developing countries) the utility will find its long-run profits enhanced if it exercises pricing restraint in the early stages of network development. These findings provide some useful insights for the design of post-privatization regulatory governance in developing countries where years of price controls have contributed to choking off investment in network expansion.
format	Journal Article
author	Chisari, Omar Kessides, Ioannis N.
author_facet	Chisari, Omar Kessides, Ioannis N.
author_sort	Chisari, Omar
title	Pricing Dynamics of Network Utilities in Developing Countries
title_short	Pricing Dynamics of Network Utilities in Developing Countries
title_full	Pricing Dynamics of Network Utilities in Developing Countries
title_fullStr	Pricing Dynamics of Network Utilities in Developing Countries
title_full_unstemmed	Pricing Dynamics of Network Utilities in Developing Countries
title_sort	pricing dynamics of network utilities in developing countries
publishDate	2012
url	http://hdl.handle.net/10986/5524
_version_	1764395360435830784

Pricing Dynamics of Network Utilities in Developing Countries

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