Subadditivity and Contestability in the Postal Sector: Theory and Evidence

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Subadditivity and Contestability in the Postal Sector: Theory and Evidence. / El Masri, Toufic.

2011. (Working Paper Series in Economics; No. 195).

Research output: Working paperWorking papers

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@techreport{58175e92df124d9781c5881a3c5e9b24,
title = "Subadditivity and Contestability in the Postal Sector: Theory and Evidence",
abstract = "Several studies have been conducted to analyze whether a regulation of the postal sector as a monopoly is actually efficient by examining its cost structure. The authors detected significant scale economies only in the delivery function and hence demonstrated a necessity for competition in the upstream operations. The primary purpose of this paper is to summarize the basic conditions of natural monopoly theory and to review the approaches and results of the studies dealing with this topic. Despite the importance of contestability in this context, previous literature concentrates only on the subadditivity aspect. The existence of economies of scale does not inevitably justify a governmental maintenance of the monopoly if the market is contestable. In this respect, further research is needed in order to account for contestability.",
keywords = "Economics, Postal sector, Scale economics, subadditivity, contestabilty",
author = "{El Masri}, Toufic",
year = "2011",
language = "English",
series = "Working Paper Series in Economics",
publisher = "University of L{\"u}neburg, Institut f{\"u}r Volkswirtschaftslehre",
number = "195",
type = "WorkingPaper",
institution = "University of L{\"u}neburg, Institut f{\"u}r Volkswirtschaftslehre",

}

RIS

TY - UNPB

T1 - Subadditivity and Contestability in the Postal Sector: Theory and Evidence

AU - El Masri, Toufic

PY - 2011

Y1 - 2011

N2 - Several studies have been conducted to analyze whether a regulation of the postal sector as a monopoly is actually efficient by examining its cost structure. The authors detected significant scale economies only in the delivery function and hence demonstrated a necessity for competition in the upstream operations. The primary purpose of this paper is to summarize the basic conditions of natural monopoly theory and to review the approaches and results of the studies dealing with this topic. Despite the importance of contestability in this context, previous literature concentrates only on the subadditivity aspect. The existence of economies of scale does not inevitably justify a governmental maintenance of the monopoly if the market is contestable. In this respect, further research is needed in order to account for contestability.

AB - Several studies have been conducted to analyze whether a regulation of the postal sector as a monopoly is actually efficient by examining its cost structure. The authors detected significant scale economies only in the delivery function and hence demonstrated a necessity for competition in the upstream operations. The primary purpose of this paper is to summarize the basic conditions of natural monopoly theory and to review the approaches and results of the studies dealing with this topic. Despite the importance of contestability in this context, previous literature concentrates only on the subadditivity aspect. The existence of economies of scale does not inevitably justify a governmental maintenance of the monopoly if the market is contestable. In this respect, further research is needed in order to account for contestability.

KW - Economics

KW - Postal sector

KW - Scale economics

KW - subadditivity

KW - contestabilty

M3 - Working papers

T3 - Working Paper Series in Economics

BT - Subadditivity and Contestability in the Postal Sector: Theory and Evidence

ER -

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