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THE POSTAL SERVICE IN THE EUROPEAN UNION PUBLIC MONOPOLY OR COMPETITIVE MARKET?: A transaction cost approach
Author(s) -
COMANDINI Vincenzo VISCO
Publication year - 1995
Publication title -
annals of public and cooperative economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.526
H-Index - 37
eISSN - 1467-8292
pISSN - 1370-4788
DOI - 10.1111/j.1467-8292.1995.tb00876.x
Subject(s) - monopoly , business , competition (biology) , statutory law , service (business) , database transaction , transaction cost , commission , value (mathematics) , economic efficiency , industrial organization , natural monopoly , economics , finance , market economy , marketing , ecology , machine learning , political science , computer science , law , biology , programming language
ABSTRACT: * The paper discusses the relevant institutional and economic aspects of the postal service, and analyses both the arguments for abolishing the statutory monopoly and those for retaining it. The main thesis of the paper is that public and private postal services differ from each other in many aspects: transaction costs, the willingness of the customer to pay, market structure, and possibilities of substituting the service with other communication instruments. Therefore, a simple privatisation will not solve per se the efficiency problems of the service. furthermore, the European Commission, which published in 1992 a green paper on postal services, is considering the possibility of harmonising the quality of the service within the EU and gradually reducing the gap in national postal prices. This seems to be an effective device to force firms towards the greater efficiency required in a Continental market. In future, the competition will take place not so much between private firms (more interested in running the high‐value segments), as between national public carriers, as shown by the phenomenon of remail .