Viktória Kocsis

Network Asymmetries and Access Pricing in Cellular Telecommunications

Network shares and retail prices are not symmetric in the telecommunications market with multiple bottlenecks which give rise to new questions of access fee regulation. In this paper we consider a model with two types of asymmetry arising from different entry timing, i.e. a larger reputation for the incumbent and lower cost of servicing for the entrant as a result of more advanced technology. As a result firms have divergent preferences over the access fee. In case of linear and non-linear prices the access fee might still act as the instrument of collusion, but only if a side-payment is permitted which is generally welfare decreasing. Moreover, in contrast with the European regulatory framework, the access fee on the basis of termination cost might not necessarily be a socially preferable solution.

Reconsidering Government Intervention in Hospital Bankruptcies: The Case of the Netherlands

In this paper, we assess the optimality of bankruptcies among hospitals in the Netherlands. Following the standard principles of bankruptcy theory, there is no strong case for governments to support hospitals that are in financial distress. Such intervention reduces hospitals’ incentives to avoid bankruptcies and also potentially allows inefficient hospitals to continue to operate. Within the context of the Netherlands, however, the question emerges whether this principle also holds for general hospitals that are faced with the non-profit constraint. In the absence of government intervention, there is a higher risk of too early liquidation. We therefore argue that more market dynamics is needed by allowing private equity in hospitals’ capital structure, thus releasing entry barriers.