Fixed-Mobile Substitution in MENA Countries: The Future of Fixed-Line Markets

摘要

The aim of this paper is to study the occurrence of Fixed-Mobile Substitutionrn(FMS) in the Middle East North African (MENA) region. While there havernbeen many studies on developed countries, empirical evidence for developingrncountries is somehow limited. In the last few years, mobile cellular subscriptionsrnachieved a tremendous growth across theMENA region making it the secondrnfastest growing region in the world in terms of mobile subscriptions in 2012, andrnthe fastest growing region in terms of mobile traffic in 2014. Fixed subscriptionsrnhave also grown but at a slower rate than mobile subscriptions. Using unbalancedrndata on 17 MENA countries over the period 1990–2009, we explore the relationshiprnbetween fixed and mobile telephone services by using dynamic panel datarnmodels.We find empirical evidence for asymmetric one-way substitution betweenrnfixed-lines and mobile phones and we estimate own- and cross-price elasticitiesrnfor fixed and mobile telephone services inMENA region. The results are then usedrnto derive policy implications in terms of market redefinition, taxation policies,rnextension of universal services and broadband markets.