The document seeks to evaluate the existence of cross subsidization between the regulated and competitive parts of the postal sector. We analyze the incentive to make cross subsidization when prices are regulated by Ramsey Pricing or by Global Price Cap. By means of a linear demand function, we found cross subsidies constrain and distort the liberalization of the sector and it is important to avoid them for the competition.
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Paper provided by UNIVERSIDAD DEL ROSARIO - FACULTAD DE ECONOMÍA in its series BORRADORES DE INVESTIGACIÓN with number
003530.
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