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Cost Impact Of New Service Providers Through Alternative Input Policy And Heterogenous Service Users

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  • Zoran Miletic

Abstract

This paper analyzes the problems of regulation in the postal sector. The shown calculations set forth several options that would be offered through the regulation of new applicants (postal service providers) in the liberalized market. Proper regulation, i.e. pricing for access to a reserved area of new providers of the universal postal service, is essential for normal functioning of the postal market. If the monopoly overprotects the current provider of the universal postal service, then the competition will not properly develop, nor will the convergence to the optimal price and quality of service provided. On the other hand, in case of insufficient regulatory regime, there will be intense competitive activity only in certain parts of the postal market, while other areas (rural areas) will be left to the current provider of the universal postal service that will provide the same service in unattractive areas and will probably generate losses or bear an unfair burden of defective regulation.

Suggested Citation

  • Zoran Miletic, 2013. "Cost Impact Of New Service Providers Through Alternative Input Policy And Heterogenous Service Users," Economic Thought and Practice, Department of Economics and Business, University of Dubrovnik, vol. 22(2), pages 469-498, december.
    • Handle: RePEc:avo:emipdu:v:22:y:2013:i:2:p:469-498
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    More about this item

    Keywords

    postal sector regulation; national postal operator; economy; new providers;
    All these keywords.

    JEL classification:

    • L51 - Industrial Organization - - Regulation and Industrial Policy - - - Economics of Regulation
    • L87 - Industrial Organization - - Industry Studies: Services - - - Postal and Delivery Services

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