Universal Service Obligations in LDCs: The Effect of Uniform Pricing on Infrastructure Access

By Xinzhu Zhang on March 17, 2011

Antonio Estache, Jean-Jacques Laffont, and Xinzhu Zhang, Director at Global Economics Group, develop a model to analyze the impacts of asymmetric information on optimal universal service policy in the public utilities of developing countries. In Universal service obligations in LDCs: The effect of uniform pricing on infrastructure access (Journal of Public Economics, Vol. 90, 2006), the authors consider the model under a discriminatory pricing regime, and uniform pricing. They find that under both pricing regimes not only the firm but also taxpayers have incentives to collude with the regulator. Universal Service Obligations in LDCs: The Effect of Uniform Pricing on Infrastructure Access