Pricing and Efficiency Decisions for Letter and Parcel Markets When Industrial Relations Matter

Philippe De Donder, Frank Rodriguez and Soterios Soteri
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Frank Rodriguez: Oxera Consulting LLP
Soterios Soteri: Royal Mail Group

A chapter in The Contribution of the Postal and Delivery Sector, 2018, pp 241-255 from Springer

Abstract: Abstract A key feature of postal markets today is the changing mix of physical mail. While the demand for letters is in decline, predominantly because of e-substitution, parcel volumes are increasing due to the rapid growth of e-commerce. Universal service providers (USPs) in the postal sector serve both markets. In the former, universal service obligations (USOs) are in place and regulators and private shareholders, where the USP is privatized, press for improvements in efficiency. In the latter, markets are highly competitive with parcel companies offering differentiated services. In both markets, USPs are under pressure to lower costs and prices to maintain financial viability. But postal operations are labor intensive and the pressure to lower costs poses a threat of industrial action.

Keywords: Universal Service Provider (USP); Parcel Volume; Universal Service Obligation (USO); Access Price; Price Control Period (search for similar items in EconPapers)
Date: 2018
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Working Paper: Pricing and Efficiency Decisions for Letter and Parcel Markets when Industrial Relations Matter (2017)
Working Paper: Pricing and Efficiency Decisions for Letter and Parcel Markets when Industrial Relations Matter (2017)
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DOI: 10.1007/978-3-319-70672-6_17

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