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Postal-Sector Policy: From Monopoly to Regulated Competition and Beyond


  • Christian Jaag


This paper discusses the main aspects of the competitive and regulatory state of the postal sector. It presents the different models for postal competition and regulation in the EU and the US and their history, together with their implications on regulation, with a focus on universal services and network access. While postal monopolies used to be the main source of funding for universal service obligations, the need for alternative funding sources after full liberalization has increased the interest of regulators and the public in knowing the cost of these obligations. In parallel, new means of electronic communication and consumer needs call the traditional scope of universal services into question. This paper outlines the economic rationale of current policies and directions for future postal regulation to strengthen the postal services? commercial viability in a competitive age, while safeguarding their relevant characteristics for the economy.

Suggested Citation

  • Christian Jaag, 2014. "Postal-Sector Policy: From Monopoly to Regulated Competition and Beyond," Working Papers 0045, Swiss Economics.
  • Handle: RePEc:chc:wpaper:0045

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    References listed on IDEAS

    1. Martin Maegli & Christian Jaag, 2013. "Competition and the social cost of regulation in the postal sector," Chapters, in: Michael A. Crew & Paul R. Kleindorfer (ed.),Reforming the Postal Sector in the Face of Electronic Competition, chapter 20, pages 294-305, Edward Elgar Publishing.
    2. De Villemeur Etienne Billette & Cremer Helmuth & Boldron Francois & Roy Bernard, 2008. "Worksharing: A Calibrated Model," Review of Network Economics, De Gruyter, vol. 7(2), pages 1-22, June.
    3. Mehdi Farsi & Massimo Filippini & Urs Trinkner, 2006. "Economies of scale, density and scope in Swiss Post?s Mail Delivery," Working Papers 0005, Swiss Economics, revised Jul 2006.
    4. Christian Jaag & Urs Trinkner, 2011. "A General Framework for Regulation and Liberalization in Network Industries," Chapters, in: Matthias Finger & Rolf W. Künneke (ed.),International Handbook of Network Industries, chapter 3, Edward Elgar Publishing.
    5. Helmut Dietl & Christian Jaag & Markus Lang & Martin Lutzenberger & Urs Trinkner, 2011. "Impact of VAT Exemptions in the Postal Sector on Competition and Welfare," Chapters, in: Michael A. Crew & Paul R. Kleindorfer (ed.),Reinventing the Postal Sector in an Electronic Age, chapter 19, Edward Elgar Publishing.
    6. Jaag Christian, 2011. "What is an Unfair Burden? Compensating the Net Cost of Universal Service Provision," Review of Network Economics, De Gruyter, vol. 10(3), pages 1-32, September.
    7. Martin Maegli & Christian Jaag & Martin Koller & Urs Trinkner, 2011. "Postal Markets and Electronic Substitution: Implications for Regulatory Practices and Institutions in Europe," Chapters, in: Michael A. Crew & Paul R. Kleindorfer (ed.),Reinventing the Postal Sector in an Electronic Age, chapter 8, Edward Elgar Publishing.
    8. Christian Jaag & Urs Trinkner, 2009. "Netzzugang im Postmarkt: Möglichkeiten und Auswirkungen," Studies and Reports, Swiss Economics, pages 1-20, August.
    9. 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.
    10. Martin Buser & Christian Jaag & Urs Trinkner, 2008. "Economics of Post Office Networks: Strategic Issues and the Impact on Mail Demand," Chapters, in: Michael A. Crew & Paul R. Kleindofer & James I. Campbell Jr (ed.),Handbook of Worldwide Postal Reform, chapter 5, Edward Elgar Publishing.
    11. Helmuth Cremer & Philippe De Donder & François Boldron & Bernard Roy, 2008. "Social Costs and Benefits of the Universal Service Obligation in the Postal Market," Chapters, in: Michael A. Crew & Paul R. Kleindorfer (ed.),Competition and Regulation in the Postal and Delivery Sector, chapter 2, Edward Elgar Publishing.
    12. Christian Jaag & Urs Trinkner, 2008. "Pricing in Competitive Two-Sided Mail Markets," Chapters, in: Michael A. Crew & Paul R. Kleindorfer (ed.),Competition and Regulation in the Postal and Delivery Sector, chapter 10, Edward Elgar Publishing.
    13. Philipp B. Schuster, 2013. "One for all and all for one: privatization and Universal Service provision in the postal sector," Applied Economics, Taylor & Francis Journals, vol. 45(26), pages 3667-3682, September.
    14. Sven Heitzler & Christian Wey, 2010. "Raising Rivals' Fixed (Labor) Costs: The Deutsche Post Case," Discussion Papers of DIW Berlin 1008, DIW Berlin, German Institute for Economic Research.
    15. Panzar, John C., 2000. "A methodology for measuring the costs of universal service obligations," Information Economics and Policy, Elsevier, vol. 12(3), pages 211-220, September.
    16. Christian Jaag & Urs Trinkner, 2011. "The future of the USO - Economic rationale for universal services and implications for a future-oriented USO," Working Papers 0026, Swiss Economics.
    17. Christian Jaag & Urs Trinkner, 2011. "The interaction between universal service costing and financing in the postal sector: a calibrated approach," Journal of Regulatory Economics, Springer, vol. 39(1), pages 89-110, February.
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    Cited by:

    1. Christian Jaag & Urs Trinkner & Jeffrey Yusof, 2014. "Assessment of EU Postal Sector Policy during the Second Barroso Administration (2010-2014)," Working Papers 0050, Swiss Economics.
    2. Catríona CAHILL & Dónal PALCIC & Eoin REEVES, 2018. "Striving To Deliver: Commercialization And Performance In Ireland'S Postal Sector," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 89(3), pages 527-542, September.
    3. Šarac, Dragana & Unterberger, Marija & Jovanović, Bojan & Kujačić, Momčilo & Trubint, Nikola & Ožegović, Spasenija, 2017. "Postal network access and service quality: Expectation and experience in Serbia," Utilities Policy, Elsevier, vol. 48(C), pages 69-75.

    More about this item


    Postal Sector; Regulation; Liberalization;

    JEL classification:

    • L52 - Industrial Organization - - Regulation and Industrial Policy - - - Industrial Policy; Sectoral Planning Methods
    • L87 - Industrial Organization - - Industry Studies: Services - - - Postal and Delivery Services

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