Mark A Jamison

Bureaucrats as Entrepreneurs: Do Municipal Telecommunications Providers Hinder Private Entrepreneurs?

We consider how government-owned enterprises affect privately owned rivals. Specifically, we compare the types of markets that municipally owned telecommunications providers in the United States serve to the types of markets that competitive local exchange carriers (CLECs) serve. We find that CLECs focus on potential profitability while municipalities appear to respond to other factors, such as political considerations or the desire to provide competition to incumbents. As a result, municipal providers tend to serve markets that CLECs do not. We also find that the presence of a municipal provider in a market does not affect the probability that a CLEC also serves that market. Our results suggest municipalities may not pose a significant competitive threat to CLECs and do not preclude CLEC participation.

Getting What You Pay for: Analyzing the Net Neutrality Debate

We analyze the effects of networks offering and charging for premium transmission service, which is central to the net neutrality debate. We find that when a network provider optimally charges for and provides premium transmission for content providers, innovation is stimulated on the edges of the network and smaller content providers benefit more than do larger content providers. Furthermore, we show that the network provider increases its investment in network capacity when it offers premium transmission without degrading service for content providers that do not purchase the premium service. Also the number of network subscribers increases.

Participation in Social Programs by Consumers and Companies: A Nationwide Analysis of Participation Rates for Telephone Lifeline Programs

Lifeline is a unique nationwide public assistance program created by the Federal Communications Commission to provide price discounts to low-income telephone subscribers. Recently there has been concern that program participation rates are low and that there is great variation in participation across states. We examine the Lifeline Program to explain why people do not participate in a program that provides them with financial benefits. Using state-level panel data, we consider reasons Lifeline participation varies among states and why only approximately one-third of eligible households nationwide enroll in the program. We find that participation is actually closely aligned with what is predicted given state characteristics when we control for socioeconomic and demographic characteristics. We also find that in addition to the demographic factors affecting participation, telecommunications companies appear to affect Lifeline participation rates.

Leadership and the independent regulator

Being a utility regulator has perils because the independence of the regulator necessarily removes power from politicians, operators, and others. Furthermore, regulators are sometimes scapegoats for unpopular policies and unavoidably become involved in shaping the policies that they are supposed to implement. As a result of such frictions, regulators are sometimes removed from office or marginalized in some way. How can regulators not only survive in such an environment, but also thrive? Jamison describes a leadership concept called adaptive leadership that regulators can use to help their countries adapt to new policies and changing situations, while allowing the regulator to stay in the game. The first leadership skill he discusses is the ability to get on the balcony to see what is really going on with operators, politicians, consumers, and others. Once this perspective is obtained, then the regulator can engage stakeholders in an adaptive process in which people make necessary changes to traditions and expectations, while hanging on to the things that are truly important. Regulators can do this by bringing attention to problems that people want to ignore because they involve difficult tradeoffs, providing certainty and stability when tensions become too high for work to be done, and keeping attention focused on the work and the issues.

General conditions for subsidy-free prices

Abstract In the traditional view, prices are subsidy-free as long as they are no greater than stand-alone cost and no less than incremental cost. This assumes that only specialized firms provide rivalry. However, diverse firms also provide rivalry called multilateral rivalry. This paper explores how multilateral rivalry that results from economies of scope affects subsidy-free prices. This rivalry shrinks the range of subsidy-free prices—the new upper bound is less than stand-alone cost and the new lower bound is greater than incremental cost. In effect, this rivalry forces a sharing of economies of scope among products.

Subsidies and Distorted Markets: Do Telecom Subsidies Affect Competition?

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.

Who Do Start‐Up Firms Imitate? A Study of New Market Entries in the Clec Industry

Institutional theory contends firms imitate other firms with ideal traits, whereas the strategic groups literature on imitation suggests firms imitate similar firms. We address this debate by studying 1,067 market entries by founder‐managed start‐ups in the U.S. Competitive Local Exchange Carrier industry from 1996 to 2004. In support of the strategic groups literature, start‐ups imitate entry decisions of and gravitate toward markets that are densely populated by other start‐ups. Though start‐ups avoid markets already densely populated by corporate ventures, they imitate the market entries of corporate ventures. Our discussion of these and other findings provide insights for start‐ups navigating new industries.

Should Google Search Be Regulated as a Public Utility

I examine the validity of the arguments for regulating Google search and find that they are insufficient and that regulation would likely be counterproductive. Google search does not fit the traditional frameworks for justifying regulatory control, namely, the public utility concept, common carrier concept, and essential facilities doctrine. For example, Google’s search is not monopolistic in nature, does not preclude rivals from competing against Google, does not rely upon grant of a franchise as does a utility, and does not take control of rivals’ content or service. Furthermore, the advocates for regulation fail to give adequate weight to the changes that constantly occur in the search business, the ways that rivals benefit from Google’s investments, the negative impacts of forcing Google to reveal its search algorithms, and regulation’s stifling effect on innovation.

Effects of Using Specific versus General Data in Social Program Research

We present a comparison of results of similar analyses of a particular social program using two sources of data: one representative of the general population, and one representative of the population that actually is eligible for the social program. To do this, we focus on a particular public assistance program as implemented in Florida as our public policy program of choice. We compare the results of an analysis of the programs participation rates using US Census data for the general population of Florida to the results of the exact same model using a dataset that includes only the population of Florida that is actually eligible for the program. We find that while generally signs of effects remain the same, they do not always remain the same; moreover, significance differs, and the marginal effects of various demographic and socio-economic factors on program participation rates vary greatly. We submit that such differences are important for policymakers to recognize so that they can effectively target programs to those individuals and geographic areas most in need of such programs.

Liberalization and Regulation of Telecoms, Electricity, and Gas in the United States

The United States has a long tradition of commission style regulation of privately owned utilities. This fact has both advantages and disadvantages. On the plus side producers, political bodies, regulatory agencies, courts, consumers, and other players are fully adapted to the idea and practice of independent regulation. Furthermore there is a ready pool of talented professionals to analyze issues and develop solutions as new issues emerge. But these advantages can also be disadvantages during times of change. Complex, well developed systems are often slow to recognize new realities and are costly to change because regulatory policies create interest groups that benefit from the status quo. In some instances new technologies and policies cannot be introduced incrementally, but rather strand investment and challenge investor’s willingness to provide funds. In this chapter we examine the development and evolution of utility regulation in the United States, focusing on energy and telecommunications. We begin with the development of these industries, taking as given the traditions, institutions, and legal frameworks created through the regulation of transportation and other industries, even though these laid critical foundations for utility regulation. We begin by describing the economic and political context for regulation. We then examine regulation for each sector. We conclude with a brief review of emerging issues.