Abstract
The main purpose of this paper is to examine developments in the regulation of natural monopoly over the last twenty years and draw some implications for the regulation of postal service. While price regulation has traditionally taken a back seat under the traditional public enterprise monopolies that were almost universal in postal service this is changing with the privatization of the Dutch and German PO’s, the increased liberalization of markets, the creation of specialized regulators most recently in the United Kingdom and similar developments.1 These developments make the form of regulation to be employed an important and topical problem. In this paper we examine what lessons can be drawn for postal regulation from the theory and the practice in other industries where regulation has existed for a considerable time.
A version of this paper was prepared for presentation at the Rutgers University 13th Annual Western Conference on Competitive Challenges in Network Industries, Monterey, CA, July 5–7, 2000. We would like to than our discussants, Fred Curry, Jutta Shaw and Yasugi Otsuka for helpful comments. In addition, we benefitted from discussions with Eric Ackerman, Carl Danner, Ahmad Faruqui and Dennis Weisman. Finally we would like to thank EPRI for providing support in a related area of research.
We are ignoring the problem of ownership. For purposes of this paper we consider the national post office to be privately owned. In this way we can consider it to be similar to other kinds of private companies in its response to regulation.
The erratum of this chapter is available at http://dx.doi.org/10.1007/978-1-4615-1671-2_22
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Crew, M.A., Kleindorfer, P.R. (2001). A Critique of the Theory of Incentive Regulation. In: Crew, M.A., Kleindorfer, P.R. (eds) Future Directions in Postal Reform. Topics in Regulatory Economics and Policy Series, vol 38. Springer, Boston, MA. https://doi.org/10.1007/978-1-4615-1671-2_3
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