The Influence of Call Graph Topology on the Dynamics of Telecommunication Markets

We propose a computational model of pre-paid telecommunication markets with plausible call patterns among customers. To simulate strategic interactions between operators our model uses an approach based on n-th order rationality with the varying planning horizon. We show that the irregular topology of the call graph leads to emergence of price discrimination patterns which are consistent with real markets but are very difficult to replicate using orthodox, representative-agent approaches.