Advertisement

Market Failure and Regulatory Reform: Energy and Telecommunication Networks as a Case Study

Chapter
  • 61 Downloads

Abstract

The deregulation of public utilities continues to be a source of controversy and debate. Economic regulation has traditionally been justified on the grounds that the provision of necessary services for all sectors of society at just and reasonable rates requires control of the firm’s ability to set exploitative prices and restrict or denigrate basic service. Proponents of deregulation argue that such regulatory intervention constitutes a barrier to innovation, protectionism for special interests, and a disincentive to minimize the cost of service. Furthermore, they insist that replacing regulation with free markets will force prices toward costs, control excess profits, and sweep aside residual pockets of monopoly power in a grand Schumpeterian manner. However, experience over the past decade has shown that these arguments are seriously flawed. This paper will examine these defects and point to institutionalist oriented reforms.

Keywords

Market Failure Price Discrimination Public Utility Asynchronous Transfer Mode Incumbent Firm 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.

Preview

Unable to display preview. Download preview PDF.

Unable to display preview. Download preview PDF.

Copyright information

© Springer Science+Business Media New York 1995

Authors and Affiliations

  1. 1.Department of EconomicsMichigan State UniversityEast LansingUSA

Personalised recommendations