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A Study on Network Competition Under Congestion  

Jung, Choong-Young (한남대학교 경영학과)
Publication Information
The Journal of Korean Institute of Communications and Information Sciences / v.34, no.1B, 2009 , pp. 24-33 More about this Journal
Abstract
This paper considers network competition where the subscribers experience network congestion when they use the network and the network providers determine the network price and capacity. This paper discusses the impact of the network competition on social welfare. Network provider determines the price and capacity considering this characteristics of this sensitivity to network congestion where the subscriber has different preference about the congestion. This paper shows that network provider who wants to serve the intolerable customers (who is very sensitive to the congestion) offers higher price and capacity. However, this provider prepares lower capacity than socially optimal capacity. This is because the network provider seeks to earn more profits from additional subscriber while it is desirable to invest the capacity to give the entire subscribers a non-congestion network in the view of social welfare.
Keywords
네트워크 혼잡;네트워크 경쟁;네트워크 용량;혼잡 민감도;사회후생;
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