lfare. A simple analysis showing that as services increase so does the price, does not answer the question as to whether customers perceive these services as increased quality. A study is needed to investigate the variables with multiple types of cable companies (those that are and are not monopolies and satellite competition). Consumer views on these issues will provide a more comprehensive understanding of welfare effects.
Havenner, Hazlett, and Leng (2001) provided additional support for this study. These authors also studied rate controls to determine effects on costs and quality, and noted that the study of these variables is complicated by a continuous evolvement of product quality. Complex and ambiguous regulations add to this confusion. Despite these problems, Havenner et al. found that losses to cable operators are not related to gains for consumers; transaction costs and counter measures by cable operators, as a response to regulation, offset consumer gains. The authors concluded that regulation may be necessary due to monopoly in cable operators, but price control does not improve consumer welfare.
Emmons and Prager (1997) analyzed private and nonprivately owned cable operators. These authors used data from two cross-sectional samples of cable television systems (one for 1983 and one for 1989). The samples each included three subsamples: all systems identified as facing direct competition from another cable operator in their franchise territory; all nonprivately owned cable television systems; and 200 randomly chosen cable television systems with no direct competition and privately owned (private monopoly). All data were from the Television and Cable Factbook and U.S. government publications (County and City
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