A Study on Price Elasticities of mobile telephone Demand in Korea 


Vol. 32,  No. 6, pp. 390-401, Jun.  2007


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  Abstract

This paper is to estimate and analyze the price elasticities of demand for mobile calls. We used the data for the period from January 2000 to December 2005 on a monthly basis. Data used are call minutes to mobile-originating(ML+MM), tariff for dispatch of fixed and mobile calls(PL, PM), income(Y), and subscriber for mobile(N). In order to provide robust estimates of price elasticities, we have used two different econometric models. One is a Dynamic model which includes a lagged dependent variable and so can differentiate between long-run and short-run price elasticities using the Generalized Method of Moments(GMM). The other is a Box-Cox transformation model which is one of the most useful methods. Box-Cox transformation model shows that elasticity changes with the lapse of time. The results are as follows : Not including the price indices for land-originating, the estimate is overestimated otherwise. In Box-Cox transformation case, price elasticity had been steadily declining. And this result shows that mobile services had been changed necessities increasingly in Korea.

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  Cite this article

[IEEE Style]

W. Jeong and B. Cho, "A Study on Price Elasticities of mobile telephone Demand in Korea," The Journal of Korean Institute of Communications and Information Sciences, vol. 32, no. 6, pp. 390-401, 2007. DOI: .

[ACM Style]

Woo-Soo Jeong and Byung-Sun Cho. 2007. A Study on Price Elasticities of mobile telephone Demand in Korea. The Journal of Korean Institute of Communications and Information Sciences, 32, 6, (2007), 390-401. DOI: .

[KICS Style]

Woo-Soo Jeong and Byung-Sun Cho, "A Study on Price Elasticities of mobile telephone Demand in Korea," The Journal of Korean Institute of Communications and Information Sciences, vol. 32, no. 6, pp. 390-401, 6. 2007.

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pISSN : 1226 - 4717
eISSN : 2287 - 3880