Examining telecommunication industry efficiencies in light of regulatory reform
Abstract
This Thesis examines Telecommunications Industry efficiencies in the face of recent regulatory reforms; Regulation was believed to be required because of the telecommunications industry's apparent natural monopoly. The promise of regulation was to act as a surrogate to competition in controlling the monopolist. Regulation should require the monopolist to operate as close to a competitive marginal cost as possible. With effective regulation, the consumer would then expect to be paying as low a price as possible for the service provided by the regulated monopolist; Aside from commendable technological and systems improvements by the telephone companies, no significant improvement in operating efficiency would be expected with rate of return regulation reform; Included in this discussion of telecommunication industry regulation is an event analysis of the trend of the employee per access line efficiency correlated with the announcement of regulatory reforms. A significant relationship is demonstrated.