Subsidies and Distorted Markets: Do Telecom Subsidies Affect Competition?

Content Provider	Semantic Scholar
Author	Chiang, Eric P. Hauge, Janice A. Jamison, Mark A.
Copyright Year	2008
Abstract	There is general concern that producer subsidies distort competition. We examine a telecommunications subsidy system that transfers money from low cost regions to high cost regions of the U.S. Even though the system is designed to be competitively neutral, we find evidence that the system, combined with carrier of last resort policies, promotes cream skimming by entrants in low cost areas and deters entry in high cost areas, where incumbents are more likely than entrants to receive subsidies. We are unable to rule out the possibility that state regulatory policies favor incumbents in states that are net beneficiaries of the subsidy system.
File Format	PDF HTM / HTML
DOI	10.2139/ssrn.1159817
Alternate Webpage(s)	http://bear.warrington.ufl.edu/centers/purc/docs/presentations/jamison/P0608_Jamison_Subsidies_and_distorted.pdf
Alternate Webpage(s)	http://warrington.ufl.edu/centers/purc/purcdocs/papers/0704_Chiang_Subsidies_and_Distorted.pdf
Alternate Webpage(s)	https://doi.org/10.2139/ssrn.1159817
Language	English
Access Restriction	Open
Content Type	Text
Resource Type	Article