A General Framework for Regulation and Liberalization in Network Industries
AbstractIn parallel with liberalization, sector-specific regulation in network industries has become a widely discussed topic among academics, policy makers, industry economists and regulators themselves. The issue of these debates has usually been on whether such regulation is necessary and if so what its optimal design should be. Some argue for complete deregulation (i.e., the complete abolishment of sector-specific regulations), whereas others propose reregulations, that is the replacement of pre-existing (monopoly) regulations by new regulations aiming at safeguarding service levels and competition. The resulting compromise is often somewhere in between; the liberalization process usually entails the partial replacement and realignment of sector-specific regulatory intervention by the disciplining forces of competition protected by competition law. Consequently, competition law and sector-specific regulation play complementary roles. In this paper, we present a general economic framework to assess regulatory remedies in network industries. Therein, liberalization, or more generally market access regulation, can be assessed as well. It provides a foundation and explanation of current sector-specific regulations in place.
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Bibliographic InfoPaper provided by Swiss Economics in its series Working Papers with number 0016.
Date of creation: Dec 2009
Date of revision:
Publication status: Published in International Handbook Of Network Industries - The Liberalization of Infrastructure, edited by Matthias Finger and Rolf Künneke. Cheltenham, UK, Edward Elgar, pp 26-53.
Liberalization; Regulation; Network industries;
Find related papers by JEL classification:
- L43 - Industrial Organization - - Antitrust Issues and Policies - - - Legal Monopolies and Regulation or Deregulation
- L44 - Industrial Organization - - Antitrust Issues and Policies - - - Antitrust Policy and Public Enterprise, Nonprofit Institutions, and Professional Organizations
- L51 - Industrial Organization - - Regulation and Industrial Policy - - - Economics of Regulation
This paper has been announced in the following NEP Reports:
- NEP-ALL-2010-06-04 (All new papers)
- NEP-LAW-2010-06-04 (Law & Economics)
- NEP-NET-2010-06-04 (Network Economics)
- NEP-REG-2010-06-04 (Regulation)
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