Saturation levels of mobile telecommunications markets and optimal termination rates

  • Daniel Ventosa-Santaulària Banco de México/CIDE
  • Alexander Elbittar CIDE
  • Pedro Matías CIDE
  • Carlos Aguilar Huerta CIDE
Keywords: mobile markets and diffusion, saturation levels, mobile termination rate
JEL Classification: L1, L5, L96

Abstract

This paper analyzes the how the two main mobile telecommunication payment regimes, receiving party pays (RPP) and calling party pays (CPP), impact mobile telecommunication diffusion patterns; and provides evidence that a quadratic and concave relationship exists between mobile termination rate and the level of penetration of mobile telecommunications. We also find significant evidence that competition, political regime and internet use affect the saturation rate as well. Finally, we find that the global behavior of telecommunication markets has contributed to a reduction in the gap between the optimal and actual mobile termination rates in most countries.

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Published
01-07-2020
How to Cite
Ventosa-Santaulària, D., Elbittar, A., Matías, P., & Aguilar Huerta, C. (2020). Saturation levels of mobile telecommunications markets and optimal termination rates. Estudios Económicos, 35(2), 331-355. https://doi.org/10.24201/ee.v35i2.406