The Costs and Benefits of Early Regulation of the Railroads

Richard O. Zerbe

Bell Journal of Economics, 1980, vol. 11, issue 1, 343-350

Abstract: In an earlier article Spann and Erickson (S-E) found that the welfare effects of early ICC regulations were negative. Their calculations fail to include part of the relevant welfare surplus and incorrectly apply demand elasticity estimates. Correct calculations, using S-E's basic data, result in positive welfare effects for 70 percent of alternative calculations across a range of assumptions. For the S-E central case correct calculations indicate positive changes in both producer and consumer surpluses. This ignores regulatory gains from price stability and fairness. The question remaining is how the long-run costs of ICC creation could have been avoided while obtaining the short-run gains.

Date: 1980
References: Add references at CitEc
Citations: View citations in EconPapers (5)

Downloads: (external link)
http://links.jstor.org/sici?sici=0361-915X%2819802 ... O%3B2-U&origin=repec full text (application/pdf)
Access to full text is restricted to JSTOR subscribers. See http://www.jstor.org for details.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:rje:bellje:v:11:y:1980:i:spring:p:343-350

Ordering information: This journal article can be ordered from
https://editorialexp ... i-bin/rje_online.cgi

Access Statistics for this article

More articles in Bell Journal of Economics from The RAND Corporation
Bibliographic data for series maintained by ().