Peak-Load Pricing of Postal Service and Competition

  • Michael A. Crew
  • Paul R. Kleindorfer
  • David de Meza
Part of the Topics in Regulatory Economics and Policy Series book series (TREP, volume 8)


As we argued in our earlier paper, the United Kingdom Post Office has a long and distinguished tradition of innovation going back to the reforms of Rowland Hill. On September 16, 1968, the Post Office introduced another major innovation, the two-tier pricing system. Peak-load pricing thus became universal in the Post Office. Without fanfare, in one stroke, peak-load pricing was applied completely to one industry. Despite the many exhortations for peak-load pricing in electricity, telephone, and other industries, in no other industry has peak-load pricing been so extensively applied as in the Post Office.1 While the practical experience of peak-load pricing gained by the Post Office has been considerable, the significance of the two-tier pricing systems has generally been missed in the literature of academic economics. The analysis provided by economists of the peak-load pricing problem in postal service has been limited to testimony by John Panzar (1984) and our recent paper with Marc Smith, (Crew, Kleindorfer, and Smith 1990, C-K-S).


Uniform Price Postal Service Quantity Discount Full Service Technical Appendix 
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Copyright information

© Springer Science+Business Media New York 1991

Authors and Affiliations

  • Michael A. Crew
  • Paul R. Kleindorfer
  • David de Meza

There are no affiliations available

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