UNSPECIFIED (1999) Regulation and access pricing: Comparison of regulated regimes. SCOTTISH JOURNAL OF POLITICAL ECONOMY, 46 (1). pp. 1-16. ISSN 0036-9292

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Abstract

The statutory duties of regulators of British utilities include both the encouragement of competition and protection of consumers (through price caps). Competition depends on the terms on which new entrants can gain access to the monopolist's network. Where the incumbent in the retail market also owns the network, the regulator may determine prices in the capped and access markets separately or may make the price cap explicitly dependent on entry in the uncapped market. Contrary to the received wisdom that access charges should be separately regulated we show that higher welfare can be obtained in some circumstances by allowing the incumbent to determine access charges. This is achieved by permitting the incumbent to choose from a menu of retail prices which the regulator makes conditional on the extent of entry in the retail market.

Item Type:	Journal Article
Subjects:	H Social Sciences > HC Economic History and Conditions J Political Science > JA Political science (General)
Journal or Publication Title:	SCOTTISH JOURNAL OF POLITICAL ECONOMY
Publisher:	BLACKWELL PUBL LTD
ISSN:	0036-9292
Date:	February 1999
Volume:	46
Number:	1
Number of Pages:	16
Page Range:	pp. 1-16
Publication Status:	Published
URI:	http://wrap.warwick.ac.uk/id/eprint/14778

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