Regulatory Environment and Firm Performance in EU Telecommunications Services

摘要

We empirically estimate the effects of regulated access prices and firms’rnmultinational status on firm performance by using firm, corporate group, andrncountry level information for the European broadband market between 2002rnand 2010. Three measures of firm performance are used, namely: market share,rnrevenue and productivity. Special attention is paid to differences in the impactrnon the performance measures depending on a firm’s position as either a marketrnincumbent or entrant. We find that while access prices have a negative effect onrnentrants’ market share and revenue, the effect on incumbents’ market share,rnrevenue and productivity is positive. Further, we find that multinational entrantsrnperform better than national entrants in terms of their market share but worse inrnterms of their revenue and productivity. The opposite is true of incumbent multinationalsrnwhich perform better than nationals in terms of their revenue andrnproductivity but worse in terms of their market share. This confirms that a firm’srnmultinational status has a significant impact on its performance, and that thisrnimpact differs for incumbents and entrants. Finally, when evaluating the impactrnof access prices on firm performance at the mean performance of national andrnmultinational firms, we find that the impact of access prices is lower for multinationalrnthan for national firms.