The Impact of Competition on Mobile Penetration in Sub-Saharan Africa
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Date
2009-06
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A.A.U
Abstract
Relying inanely on a recently published data of the International Telecommunication
Union (ITU), World Telecommunications/lCT Indicators (2008) and on a global database
of mobile market information-Wireless Intelligence, we investigate the impact of
competition on mobile penetration in 35 Sub Saharan African countries for the period
2000-2006. This study examines not only the impact of introduction of competition but
also the role of intensity of competition on mobile penetration in the region. To this effect,
we use different equations with different measures of competition that reflect either the
introduction or intensity of competition on the sector. Thereafter, controlling various
sector characteristics and macroeconomic indicators, we apply panel data regression
analysis with fixed effects. Besides, we test potential endogeneity problems and use
appropriate estimation technique as necessary. For the most part, the results of this study
come out consistent with the existing literature. That is, estimation results confirm that
introduction of competition in the mobile market is strongly and positively associated
with mobile penetration. Furthermore, the results of this study indicate that promoting
effective competition plays a significant role in increasing mobile penetration
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Keywords
Sub-Saharan Africa, Mobile Penetration