Abstract
This thesis is about investment and access in network industries. More specifically, the aim of the thesis is to build theoretical models to examine some of the aspects of the link between access prices and incentives to invest in network infrastructure. We consider two basic questions relating to these issues, namely (i) how best to fund an incumbent network owner's investment when the network is an essential input for the operation of downstream providers, and (ii) what level of coverage a new firm which enters a market by building its own network infrastructure will choose. The choice of access prices has drawn a lot of attention from regulation economists and is a central aspect of regulatory planning. However, while becoming central to policy debate in the area, the effect of this choice on firms' incentives to invest in network infrastructure has received only limited attention. The questions considered here are motivated by examples in several network utilities in the UK and abroad. In both cases, substantial debate taking place concerning the choice of access prices and, at the same time, major investment in network infrastructure is required and is indeed taking place.