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Networks in Decline: Should Price Regulation Be Abolished?

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  • Paula Sarmento
  • António Brandão

Abstract

Some utilities such as postal services, gas and electricity are facing significant decline in demand within several of their business segments. In this context, an important matter for regulators, firms and consumers is to consider if maintaining price regulation is welfare enhancing compared with the no regulation alternative. From a model with one firm that is simultaneously monopolist in a regulated market and is in competition in a liberalized market, we conclude that welfare can be higher when price regulation is preserved.

Suggested Citation

  • Paula Sarmento & António Brandão, 2020. "Networks in Decline: Should Price Regulation Be Abolished?," International Journal of the Economics of Business, Taylor & Francis Journals, vol. 27(3), pages 377-389, September.
    • Handle: RePEc:taf:ijecbs:v:27:y:2020:i:3:p:377-389
    DOI: 10.1080/13571516.2020.1718472
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