Date of Award

2021

Degree Type

Dissertation

Degree Name

Doctor of Philosophy (PhD)

Graduate Group

Economics

First Advisor

Aviv Nevo

Abstract

In the first chapter of this dissertation, I study coverage requirements, a common regulation in the mobile telecommunications industry that intends to accelerate the roll-out of new mobile telecommunications technologies to disadvantaged areas. I argue that the regulation may engender entry deterrence effects that limit its efficacy and lead to technology introduction patterns that are not cost-efficient. To quantify the impact of coverage requirements on market structure and the speed and cost of technology roll-out, I develop and estimate a dynamic game of entry and technologyupgrade under regulation. I estimate the model using panel data on mobile technology availability at the municipality level in Brazil. In counterfactual simulations, I find that coverage requirements accelerate the introduction of 3G technology by just over one year, on average, and reduce firms’ profits by 24% relative to a scenario with no regulation. I find the entry deterrence effects to be small. Moreover, an alternative subsidization policy leads to a similar acceleration in the roll-out of 3G and substantially higher aggregate profits, likely increasing aggregate welfare relative to coverage requirements. In the second chapter, I investigate how the portfolio of products carried by retailers influences wholesale and retail prices. To this end, I develop and estimate a model of retailer pricing and retailer-manufacturer negotiations over wholesale prices. The estimation approach extends existing econometric tools for multi-product bargaining models to a setting with optimal downstream pricing. I use the estimated model to simulate the effects of counterfactual scenarios in which private label products or the products of a national manufacturer are excluded from retailers’ product portfolios. I find that wholesale prices do increase, but those effects are small. Eliminating private label products leads to an average increase in wholesale prices of only 0.10%; retail prices increase by only 0.04%. Eliminating a national manufacturer’s products leads to increases in wholesale prices between 0.003% and 0.677%; retail prices decrease by 0.027%-4.210% due to downstream pricing incentives.

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