The Economic Efficiency of Telecommunications in a Deregulated Market: The case of New Zealand

This paper estimates the productivity and consumer and producer changes in the New Zealand telecommunications network market between 1987, when it was deregulated, and 1993; as the major firm, Telecom, evolved from a government department to a public company in an environment of light regulation. Th...

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Bibliographic Details
Published in:The Economic record 1996-03, Vol.72 (216), p.24-35
Main Authors: BOER, DAVID BOLES DE, EVANS, LEWIS
Format: Article
Language:English
Subjects:
Accountability
Communications networks
Competition
Consortia
Consumer Price Index
Consumers
Deregulation
Econometrics
Economic efficiency
Economic models
Economic theory
Efficiency
Efficient markets
Employment
Government agencies
Market
New Zealand
Operating companies
Politics
Post offices
Privatization
Productivity
Profitability
Public sector
Regulation
Rentals
Studies
Telecommunications
Telecommunications industry
Wage & price controls
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Summary:This paper estimates the productivity and consumer and producer changes in the New Zealand telecommunications network market between 1987, when it was deregulated, and 1993; as the major firm, Telecom, evolved from a government department to a public company in an environment of light regulation. The growth in productivity is estimated to reduced costs at an annual compound average of 5.6 per cent. The bulk of the substantial gains in consumer surplus has come from price reductions on 1987 consumption levels. There has been marked improvements in the quality of outputs. Shareholders have had a profitable investment.
ISSN:0013-0249
1475-4932
DOI:10.1111/j.1475-4932.1996.tb02606.x