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October 8, 2008
DTV coupon program mainly benefits retailers, not consumers
DTV Coupon Program Mainly Benefits Retailers, not Consumers
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TPI vice president for research and senior fellow Scott Wallsten finds in a new paper that the government's DTV coupon program has increased the price of digital-to-analog converter boxes by $21-$34, meaning that the subsidy is primarily benefiting retailers rather than consumers. The $40 coupons made available to all households means that consumers pay $0 for any retail price less than $40 for eligible boxes, thus diminishing price competition among retailers. Given the increase in prices, the coupon program may not provide much additional incentive for consumers to purchase converter boxes.
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