Farmer groups and input access: When membership is not enough

This paper explores the efficiency of a targeted fertilizer subsidy program administered differently in two Nigerian states in 2009. An important dimension along which the otherwise similar programs differed was the fertilizer distribution strategy. Fertilizer distribution among program participants was done at the individual level for one set of farmers, while the fertilizer was given indirectly through a group representative for the other set. Where fertilizer was given to a group representative for further distribution to members, relatives of the farm group’s president received more bags of fertilizer than others. Where fertilizer was given directly to farmers such results did not obtain. This differential outcome suggests that while groups may facilitate the process of farmer identification and coordination, elite capture and intra group dynamics may affect their efficacy for providing equal access to inputs for members. Two-tier models enable us to model the potentially separate processes that determine participation in the voucher program and the amount of fertilizer received, upon deciding to participate. With intentions to adopt and scale up voucher programs in various food security and poverty alleviation programs across developing countries, it is important to understand when and how farmer groups can affect the successful implementation of such programs.     

Effective competition and ineffective mobile industry regulation in South Africa

The most striking feature of South Africa’s mobile market is the skewed allocation of spectrum and a seemingly endless sequence of failed attempts to hold an auction for it. A shortage of spectrum (or the inefficient assignment of it) is blamed, among other things, for South Africa’s relatively slow LTE 4G speeds. Through historical accident, the country has two mobile data networks in addition to the four licensed mobile operators. The response of operators has been to innovate using roaming and network sharing agreements; as we explore in this paper, these have become the de facto spectrum allocation process.This paper looks at how the de facto industry structure has been moulded by spectrum holdings and sharing arrangements and asks how spectrum management could be improved. We observe that, although the number of mobile operators has effectively been reduced to 3 (a number which would raise concern in some circles), there exist a variety of arrangements between those three and other spectrum and network operators. The smallest of the current three mobile operators is still not able to offer a nationwide mobile service without a roaming agreement but, at the same time, the two larger operators depend critically on spectrum and roaming agreements themselves, mainly with the two physical data network operators that function as wholesale providers.The Independent Communications Authority of South Africa (ICASA) was established as a consequence of a new constitution that was adopted in 1996 and it helped to create new institutional arrangements for the burgeoning mobile industry. The authority has nevertheless continued to be hampered, as we shall demonstrate, by political imperatives. This has been pointed out by other authors over the past twenty years and we add to this body of evidence by considering the spectrum auction planned (again) for 2021.The “2021” auction is in fact an iteration of the auction originally announced in May 2010 and then abandoned (Song, 2011). The same thing happened again in 2016 (Paelo & Robb, 2020). Late in 2020, the regulator again announced an auction, due to take place during 2021 but by the second quarter of the year, two of the four national operators had already obtained a court injunction to stop it. The process is intertwined with a political imperative to establish a public wireless open-access network, which we discuss in detail.We describe how the industry has navigated around policy and regulatory dysfunction and how competitive interaction among the South African operators has managed to prevail. Following Hausman & Taylor’s (2013) lead in their work on the United States, in this paper we provide a commentary on apparently perverse outcomes from significant regulatory, judicial and legislative actions (or, perhaps more accurately, inactions) governing the South African mobile telecommunications industry from the commencement of the current constitutional arrangements in 1996 to the present.     

When technological superiority is not enough: The struggle to impose the SIM card as the NFC Secure Element for mobile payment platforms

Mobile network operators have long played an essential role in the Near Field Communication (NFC) mobile payment ecosystem. In most implementations, the SIM card has been the main technical component to secure payments. Currently, mobile payment providers are increasingly planning to place the Secure Element (SE) for authentication in the handset or cloud, rather than on the SIM card. This paper unveils factors that influence stakeholder preferences for the SE location. To structure the analysis, we use a multi-level framework based on concepts borrowed from multi-sided platform theory. Using interviews with stakeholders, we elicit themes and preferences for each level of the framework (provider, technology, and user). Our findings explain why mobile network operators, despite their superior technology, will likely lose the battle for control in the mobile payment ecosystem.     

Regulation and competition in the European mobile communications industry: An examination of the implementation of mobile number portability

Over the past two decades, the mobile communications industry has seen a considerable drop in the consumer switching charges made by service providers in order to promote effective competition and ensure a level playing field for new market entrants. Mobile Number Portability (MNP) is an important regulatory measure taken to reduce switching costs, and it is believed to play an important role in fostering competition in the mobile market. MNP implementation has varied significantly across European Union countries, particularly with respect to porting time and customer fees, both of which are important factors when deciding whether to switch to another provider. The research examines the effects of MNP implementation on competition in the European mobile communications industry. The study findings indicate that subscriber churn rates are negatively affected by both the level of charges levied on subscribers wishing to maintain their current number (porting) when switching mobile providers and the length of time required to switch. The implications of the effectiveness of MNP regulation for competition in the mobile communications industry are discussed.     

Revenue Sharing and Competitive Balance When Teams are not Wage Takers

Recent papers have enriched the conventional modeling of teams’ behavior through a game theoretic background at the competition level (introducing a contest success function). We take a step forward and consider contest on the talent market as well. Each team takes into account the fact that the price to be paid recruiting talent is a function that depends on both its own demand and the demands from the rival teams. For the two-team model, we show that the removal of the assumption that teams are price takers implies that the invariance proposition only survives if the price-function for talent is linear increasing. The extension to the n-team model shows that this result no longer holds; in fact, revenue sharing improves the competitive balance. More generally, an improvement in competitive balance is the most likely if one rules out the possibility of a very convex price-function. In addition revenue sharing can reduce the economic inefficiency of teams’ behavior, and so profits may increase.     

Fixed and mobile competition in transition economies

The main aim of this paper is to explore the competition between traditional fixed line and mobile services across Eastern Europe and the Former Soviet Union. Whilst there have been some pioneer studies in the US, empirical evidence for other regions is very limited. Transition countries witnessed important trends in the mobile segment of the market. First, mobile penetration rates have been growing at exponential rates, whereas fixed line penetration rates have at best stagnated. The present analysis is based on empirical evidence based on country level data and case studies, as well as enterprise level data based on major surveys that the EBRD and the World Bank undertook in 2002 across all transition economies. Econometric analysis at the enterprise level shows some interesting results, including evidence of strong network externalities and fixed to mobile substitution effects at the country level.     

Skills shortages are not always what they seem: migration and the Irish software industry

This paper argues that the skills shortage in the Irish software industry is socially produced by a range of domestic factors, especially the education and training system. It also contends that immigration reinforces rather than resolves skills shortages.     

Concentration and non-price competition in the recording industry

This paper examines the effect of varying levels of concentration on a certain type of non-price competition in the recording industry. That dimension of rivalry is the quantity of new recordings released which, as our analysis shows, is likely to be directly related to the degree of musical innovation and diversity offered by the industry. Two theoretical models of the effects of concentration on recording firm behavior are developed and empirical tests are derived to determine if either model correctly predicts industry behavior. Examination of two sets of data suggests that increases in concentration may have led to fewer releases of new recordings, possibly as a result of collusive conduct.     

Competition in Turkish mobile telecommunications markets: Price elasticities and network substitution

This paper estimates demand elasticities for Turkish mobile telecommunications markets. In contrast to most other studies, firm-level data is used to estimate dynamic panel data models including instrumental variable techniques. Both short- and long-run elasticities are calculated, yielding a long-run price elasticity of −0.72 for the post-paid market and of −0.33 for the pre-paid market. The short-run price elasticity is estimated to be −0.36 for the post-paid market and −0.20 for the pre-paid market. In addition, there is evidence of fixed-to-mobile traffic substitution for consumers who use pre-paid cards.     

Spectrum limits and competition in mobile markets: the role of licence fees

The paper discusses the impact of scarcity of frequency spectrum on the performance of the mobile telecommunications industry. An oligopoly model with endogenous sunk costs illustrates the trade off between ex ante extraction of oligopoly rents and market entry of firms. The determination of the licence fee through an auction provides scope for setting market structure endogenously: the higher the licence fee, the lower the number of firms sustained by the market. High licence fees may be a signal for post-entry collusion. Differences across national regulatory frameworks with respect to the conditions for allocation of spectrum licenses may induce problems of fair competition in an integrated market.     

When are technologies disruptive? a demand‐based view of the emergence of competition

By identifying the possibility that technologies with inferior performance can displace established incumbents, the notion of disruptive technologies, pioneered by Christensen (1997), has had a profound effect on the way in which scholars and managers approach technology competition. While the phenomenon of disruptive technologies has been well documented, the underlying theoretical drivers of technology disruption are less well understood. This article identifies the demand conditions that enable disruptive dynamics. By examining how consumers evaluate technology and how this evaluation changes as performance improves, it offers new theoretical insight into the impact of the structure of the demand environment on competitive dynamics. Two new constructs—preference overlap and preference symmetry—are introduced to characterize the relationships among the preferences of different market segments. The article presents a formal model that examines how these relationships lead to the emergence of different competitive regimes. The model is analyzed using computer simulation. The theory and model results hold implications for understanding the dynamics of disruptive technologies and suggest new indicators for assessing disruptive threats. Copyright © 2002 John Wiley & Sons, Ltd.     

Complexity in the telecommunications industry: When integrating infrastructure and services backfires

The emergence of pure Internet-based service providers has put many integrated telecommunications firms - industry incumbents that provide services on their own infrastructure - under massive pressure. While various pure service providers enjoy high performance, the products offered by the incumbents often cannot compete on either price or user experience. Conventional wisdom, however, might suggest the opposite: that coordinating both infrastructure and services might allow the incumbents to reap synergy effects and create superior products. To address this issue, this paper applies a complex systems perspective to the telecommunications industry. It conceptualizes telecommunications firms to be searching for good configurations of interdependent service and infrastructure activities that need to fit together to achieve high-performing product systems. Using a simulation model, the paper shows that integrated operators can indeed take advantage of the interdependencies between the infrastructure and the service domain, resulting in superior product performance. Integrating infrastructure and services, however, can backfire: because learning about both domains and their interdependence requires more time, performance in the short run will be lower than that of pure service providers that can focus on adapting their service-related activities to an infrastructure that is beyond their control. The paper characterizes the conditions under which these effects can arise and concludes with implications for management and policy.     

The degree of competition in the advertising industry

After a merger wave began among advertising agencies in the late 1960's, the Federal Trade Commission investigated the anticompetitive effects of the mergers and concluded that the industry would remain competitive. In this paper, we employ a method suggested by Bresnahan to investigate the issue of competition in the advertising industry. The method uses industry-level data over the period 1972–87 to consider the determinants of supply and demand for advertising messages and to calculate the degree of market power on the supply side of the market. Statistical results support the hypothesis that the industry was competitive over this period.We thank Robert Coen of McCann-Erickson, Inc., for providing data on advertising costs and expenditures and W. Bradford Todd of the Richards Group for information about the industry. Lacy Glenn Thomas directed us to McCann-Erickson. We also thank James C. Murdoch, two anonymous referees, and the Editor, William G. Shepherd. Pornpong Sumanun provided research assistance. The usual disclaimer applies.     

Strategic entry and potential competition: Evidence from compressed gas fuel retail

We provide novel evidence on the effect of the threat of potential competition on the timing of entry in a new and growing industry. Exploiting a change in regulation in the Italian retail fuel market that generates exogenous variation in the number of potential entrants in the emerging Compressed Natural Gas segment, we show that markets with a higher number of potential entrants witness speedier entry decisions. We document that this result is likely driven by an increase in the incentives to preempt the market due to heightened risk of being anticipated by competitors.     

The impact of competition strength and density on performance: The technological competition networks in the wind energy industry

Technological competition plays an important role in technological development and innovation. However, technological competition networks have long been ignored in research. Based on the social network theory, we proposed that the innovation of an organization is greatly affected by the technological competition networks that it is embedded in. We introduced International Patent Classifications (IPCs) information to construct technological competition networks of organizations, and explored how competition network characteristics influence the organizational competitive capability and innovation performance.Based on the wind energy patent data between 2005 and 2014, we synthetically investigated the technological development and competition networks in the industry. Our findings show that (1) the evolutionary trends of patents and technology elements growth exhibit similar patterns (i.e., increasing before 2011 and decreasing after 2011); (2) the burst detection algorithm detects that 140 technological elements and 132 organizations experienced a sudden growth in production; (3) wind energy organizations intensively compete with each other, and in each year, only 10% of organizations can improve their technological competitive positions in the following year; (4) competition density in a competition network increases the technological competitive capability and innovation performance of firms. Additionally, competition strength has an inverted-U shaped relationship with both the aforementioned outcomes.     

Multi-market contact and competition: evidence from the Depression-era portland cement industry

Theoretical work has suggested that contact between firms in different markets can facilitate tacit collusion. Empirical work on this link has been limited. We address the paucity of empirical evidence with a novel plant-level dataset for the cement industry during the Great Depression. We find that multi-market contact fosters tacit collusion and higher prices based on a new measure of contact that accounts for capacity utilization. A one standard deviation increase in our measure of contact increases prices by around 4.3%. We then examine the effect of the National Industrial Recovery Act's “Codes of Fair Conduct,” introduced in 1933 to stem deflation through cooperative behavior within industries. We find that the effects of the codes were most strongly felt in markets with the highest level of multi-market contact. This suggests that multi-market contact can be a useful ‘tool’ for firms to support collusive outcomes, tacit or otherwise.     

Access regulation and infrastructure investment in the mobile telecommunications industry

While mobile virtual network operators (MVNOs) increase competition in the mobile telecommunications industry, granting market access to MVNOs may have unwanted consequences. In particular, infrastructure investment by incumbent mobile network operators (MNOs) may be smaller. This paper examines the effects of MVNO entry and access regulation on the investment behavior of MNOs. It uses firm-level data for 58 MNOs in 21 OECD countries during 2000–2008. The results suggest that mandated provision of access is related to lower investment intensity of MNOs, while voluntary access provision has no effect. Although reduced investment incentives do not necessarily correspond to under-investment, this underscores the need for those countries where MVNOs are provided access to address the issue of investment incentives.