Equally Efficient Competitor and the Case of Deutsche Telekom: Economic Perspective
International Journal of Economic Behavior and Organization
Volume 3, Issue 2-1, April 2015, Pages: 39-45
Received: Feb. 2, 2015; Accepted: Feb. 26, 2015; Published: Mar. 18, 2015
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Authors
Yasuo Kawashima, Faculty of Economics, Chuo University, Tokyo, Japan
Nobufumi Nishimura, Faculty of Law, Chuo University, Tokyo, Japan
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Abstract
We examine the implication of the assumption in two types of regulatory environments that a new entrant is an equally efficient competitor, on which the price squeeze test is built. Under partial regulation the entrant exits a market because of the higher access rates set by the authority. If we consider this assumption under no regulation, the entrant exits the market by its own inefficiency, and not by the exclusionary strategies of the incumbent. Regardless of the regulatory environments, the incumbent is not responsible for the exit and the assumption is contradictory to the EC decision.
Keywords
Equally Efficient Competitor, Regulatory Environment, Exit of Entrant, 2003 EC Decision, Case of Deutsche Telekom
To cite this article
Yasuo Kawashima, Nobufumi Nishimura, Equally Efficient Competitor and the Case of Deutsche Telekom: Economic Perspective, International Journal of Economic Behavior and Organization. Special Issue: Recent Developments of Economic Theory and Its Applications. Vol. 3, No. 2-1, 2015, pp. 39-45. doi: 10.11648/j.ijebo.s.2015030201.17
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