Criterion Releases Two Studies Questioning the Benefits of USF Subsidies to Wireless Carriers

June 13, 2007

Criterion Economics released two studies today calling into question whether universal service subsidies for cell phone companies generate benefits for consumers. The first study, by Criterion expert Nicholas Vantzelfde, compares the coverage of subsidized wireless carriers with coverage provided by unsubsidized wireless carriers in the same areas. The second study, by Criterion economist Kevin Caves and Chairman Jeffrey Eisenach, uses regression analysis to examine the relationship between subsidies and wireless availability. Both studies find that the current universal service program is ineffective in increasing wireless availability and that policymakers should consider capping funding and/or implementing reforms.

To see the full press release, click here.

To read the Vantzelfde study, click here.

To see the Caves/Eisenach study, click here.