Abstract
We propose a calibration of an analytical model, which represents postal activity in a market such as that in Belgium that is in the process of being liberalized. Representative customers send letters to two zones (densely and non-densely populated) and can be served in a perfectly substitutable way by both an Incumbent and an Entrant. In addition to tariff uniformity, the Incumbent is subject to two alternative types of cost-related access price cap constraints, which would be imposed by the regulator, while the Entrant is not. The Entrant can choose to deliver himself or to use the Incumbent’s delivery network. He can also decide whether he wishes to offer his service in both the dense and the non-dense or only one of the zones. The Incumbent respects the rules of the universal service and keeps the tariff fixed at the rate of the base period. The Entrant maximizes his profits.
The views expressed in this contribution are those of the authors and do not reflect necessarily the views of De Post / La Poste (Belgium)
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d’Alcantara, G., Amerlynck, B. (2003). Financial Viability of the Universal Postal Service Provider. In: Crew, M.A., Kleindorfer, P.R. (eds) Competitive Transformation of the Postal and Delivery Sector. Topics in Regulatory Economics and Policy Series, vol 46. Springer, Boston, MA. https://doi.org/10.1007/978-1-4419-8915-4_5
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DOI: https://doi.org/10.1007/978-1-4419-8915-4_5
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