An expanding economics literature has examined the theoretical linkages between mandatory unbundling in the telecommunications sector and the incentives to invest in facilities by both incumbent local carriers and competitive carriers. Recent empirical evidence that substantiates the theory has emerged. That literature documents CLECs’ reluctance to make facilities-based investments instead of availing themselves of incumbents’ UNEs at low regulated prices that are based on total element long-run incremental costs (TELRIC). By examining the variation in facilities-based investment in loops across U.S. states and over time, we find that facilities-based line growth relative to UNE growth was faster in states where the cost of UNEs was higher relative to the cost of facilities-based investment.

The merger of AOL and Time Warner involved a vertical combination of the largest Internet content provider and aggregator and a large cable system operator which o¡ers a conduit through which broadband customers can access Internet content at high speeds. We consider the economic incentives of such a ¢rm to engage in two distinct vertical foreclosure strategies: (1) conduit discriminationöinsulating its own conduit from competition by limiting rival platform distribution of its a¤liated content and services, and (2) content discriminationöinsulating its own a¤liated content from competition by blocking or degrading the quality of outside content.

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Proposed legislation seeks to impose price transparency in the heath care industry as a remedy for increasing medical device prices. This paper analyzes previous attempts to mandate similar price-disclosure rules in a variety of industries. We identify the economic conditions under which mandatory price disclosure is likely to generate substantial benefits and costs. Applying these conditions, we conclude that mandatory price disclosure for implantable devices is unlikely to pass a benefit-cost test. [Health Affairs 27, no. 6 (2008): 1554-1559 10.1377/hlthaff.27.6.1554 A n u m b e r o f health care policy analysts have advocated greater price transparency as a way to empower patients and reduce health costs. 1 According to these analysts, providing more information about the cost of a product or procedure to the public would allow patients to make more informed and cost-effective decisions for medical care. 2 Other scholars, such as Mark Pauly and Lawton Burns, argue that price information should flow freely between hospital purchasing agents and doctors. 3 We agree. The issue we address in this essay is whether the government should compel medical device makers to share their pricing information with the public. Here we examine the advantages and disadvantages of mandatory price disclosure for device makers.We restrict our analysis to one family of products-implantable medical devices-that have received recent attention. Implantable medical devices, such as implantable cardioverter defibrillators (ICDs) and coronary stents, are typically provided to patients through surgical procedures performed in hospitals. Setting aside the role of purchasers, the initial purchaser of the product is the hospital rather than the patient, although the patient and the insurance company ultimately pay for the device and any related procedures from the hospital.Many advocates argue that mandatory price disclosure in this industry would benefit consumers. Yet there has been no analysis of whether the alleged benefits are likely to exceed the costs. To our knowledge, we are the first to provide a rigorous economic framework for analyzing the likely benefits and costs associated with proposed legislation on disclosure being considered by Congress. 4 The Current Proposal