Regulatory Governance Costs in Network Industries: Observations in Postal Regulation
AbstractThe various actors in the regulated industries relate to each other within a broader institutional framework, i.e., by way of formal and informal rules. An important role in the implementation of liberalization processes is given to regulation and thus to regulatory institutions. The rationale for regulation is its positive effect on society by correcting market failures. But regulatory intervention also causes costs which we call "costs of regulatory governance". These costs result from negative consequences caused by regulatory requirements and from the implementation of regulatory instruments. These costs will depend upon the formal and informal rules among the involved actors, upon the allocation of property rights among these actors, as well as upon the various principal-agent or more generally contractual relationships among these actors. We distinguish between direct and indirect costs of regulation: Direct costs occur in relation with the institutional design of the regulatory framework and the behaviour of actors. Indirect costs result from distorted incentives and finally turn out in an inefficient supply of goods and services. Using the example of the Swiss postal market we offer a first outline of a possible application of the framework. In this article we neither intend to quantify regulatory costs nor do we question regulation per se. We rather present a qualitative framework which helps to structure a discussion about regulatory challenges in network industries.
Download InfoTo our knowledge, this item is not available for download. To find whether it is available, there are three options:
1. Check below under "Related research" whether another version of this item is available online.
2. Check on the provider's web page whether it is in fact available.
3. Perform a search for a similarly titled item that would be available.
Bibliographic InfoArticle provided by Intersentia in its journal Competition and Regulation in Network Industries (CRNI).
Volume (Year): 11 (2010)
Issue (Month): 2 (June)
Contact details of provider:
Web page: http://www.crninet.com/
Other versions of this item:
- Martin Maegli & Christian Jaag & Matthias Finger, 2010. "Regulatory Governance Costs in Network Industries: Observations in Postal Regulation," Working Papers 0018, Swiss Economics.
- L51 - Industrial Organization - - Regulation and Industrial Policy - - - Economics of Regulation
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Mark Armstrong & David E.M. Sappington, 2006.
"Regulation, Competition and Liberalization,"
Journal of Economic Literature,
American Economic Association, vol. 44(2), pages 325-366, June.
- Knieps, Günter & Weiß, Hans-Jörg, 2008. "Regulatory agencies and regulatory risk," Discussion Papers 118 [rev.], University of Freiburg, Institute for Transport Economics and Regional Policy.
- Christian Jaag, 2007.
"Liberalization of the Swiss Letter Market and the Viability of Universal Service Obligations,"
0006, Swiss Economics.
- Christian Jaag, 2007. "Liberalization of the Swiss Letter Market and the Viability of Universal Service Obligations," Swiss Journal of Economics and Statistics (SJES), Swiss Society of Economics and Statistics (SSES), vol. 143(III), pages 261-282, September.
- Jaag, Christian, 2007. "Liberalization of the Swiss Letter Market and the Viability of Universal Service Obligations," MPRA Paper 6121, University Library of Munich, Germany.
- Dassler, Thoralf, 2006. "Combining theories of regulation - Proposing a framework for analysing regulatory systems worldwide," Utilities Policy, Elsevier, vol. 14(1), pages 31-43, March.
- Richard A. Posner, 1974.
"Theories of Economic Regulation,"
NBER Working Papers
0041, National Bureau of Economic Research, Inc.
- Steven Tadelis & Oliver E.Williamson, 2012.
"Transaction Cost Economics
[The Handbook of Organizational Economics]," Introductory Chapters, Princeton University Press.
- Bijl, P.W.J. de & Damme, E.E.C. van & Larouche, P., 2006. "Regulating access to stimulate competition in postal markets?," Open Access publications from Tilburg University urn:nbn:nl:ui:12-175386, Tilburg University.
- Williamson, Oliver E, 1999. "Public and Private Bureaucracies: A Transaction Cost Economics Perspective," Journal of Law, Economics and Organization, Oxford University Press, vol. 15(1), pages 306-42, April.
- Knieps, Günter, 2002. "Does the system of letter conveyance constitute a bottleneck resource?," Discussion Papers 88, University of Freiburg, Institute for Transport Economics and Regional Policy.
- Frank A.G. den Butter & Marc de Graaf & Andr� Nijsen, 2009. "The Transaction Costs Perspective on Costs And Benefits of Government Regulation," Tinbergen Institute Discussion Papers 09-013/3, Tinbergen Institute.
- Mueller,Dennis C., 2003. "Public Choice III," Cambridge Books, Cambridge University Press, number 9780521894753, October.
- John C. Panzar & Robert D. Willig, 1977. "Free Entry and the Sustainability of Natural Monopoly," Bell Journal of Economics, The RAND Corporation, vol. 8(1), pages 1-22, Spring.
- M. Finger & J. Groenewegen & R. KÃ¼nneke, 2005. "The Quest for Coherence Between Institutions and Technologies in Infrastructures," Competition and Regulation in Network Industries, Intersentia, vol. 6(4), pages 227-260, December.
- Christian Jaag & Urs Trinkner, 2009. "A General Framework for Regulation and Liberalization in Network Industries," Working Papers 0016, Swiss Economics.
- Christian Jaag & Urs Trinkner, 2007. "Pricing in competitive two-sided mail markets," Working Papers 0007, Swiss Economics, revised Jul 2007.
- Bonardi, Jean-Philippe & Holburn, Guy & Vanden Bergh, Rick, 2006. "Nonmarket performance: Evidence from U.S. electric utilities," MPRA Paper 14437, University Library of Munich, Germany.
- Martin Maegli & Christian Jaag, 2012. "Competition and the Social Cost of Regulation in the Postal Sector," Working Papers 0032, Swiss Economics.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Petra Van den Bempt).
If references are entirely missing, you can add them using this form.