Funding the USO: Cross-Subsidization and Net Cost Balancing

Andreas Haller, Christian Jaag and Urs Trinkner

A chapter in The Changing Postal Environment, 2020, pp 129-137 from Springer

Abstract: Abstract Incumbent operators providing universal services are increasingly active in competitive markets, which raise the issue of cross-subsidization. We analyze the competitive and welfare properties of the Swiss net cost balancing mechanism (NCB) applied since 2013 in the postal sector, and compare it to the traditional fully distributed cost approach based on activities. We find that NCB resolves the relevant competitive concerns while having superior welfare properties.

Date: 2020
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Persistent link: https://EconPapers.repec.org/RePEc:spr:topchp:978-3-030-34532-7_10

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DOI: 10.1007/978-3-030-34532-7_10

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