Competition and Regulation in Network Industries

The article examines a decision adopted by the Hellenic Telecommunications and Post Commission (EETT) under its competition law competence on a margin squeeze allegedly applied by the Greek incumbent in the markets for broadband internet access and services. Three main criticisms are addressed to the decision regarding market definition, the imputation test used (and particularly the test for assessing profitability over time), and the proof of likely anticompetitive effects in the relevant market. In light of those criticisms, it is argued that the margin squeeze test for establishing an abuse of dominance is based upon a number of ad hoc assumptions, which might turn it into a discretionary, outcome-oriented device at the hands of the Competition Authorities.

This paper looks at the efficiency of airports and the ways in which the shifting regulatory structure of airports is gradually impacting on this efficiency. It considers the context in which airports, the nodes in the air transportation system, function in terms of both market and institutional forces, and argues that considerations of efficiency need to be viewed in a normative as well as a positive context. The role of institutions, embracing both private sector corporate entities and public government and governance are considered. What emerges is that there is no single model that demonstrably maximizes efficiency, at least not in the narrow economic sense, but rather that there are a number of experiments that are taking place within a variety of institutional contexts.

In this article, we examine the universal service obligation for telephone directories. In most countries, this obligation consists of two parts. First, publishers must offer a comprehensive directory, including all telephone subscribers. Second, this directory should be available to all users. Building a simple theoretical model, inspired by the literature on two-sided markets, we find that one of these two obligations is redundant. Imposing availability to all users is sufficient to induce publishers to offer a comprehensive directory. The reverse however does not hold.

Liberalization and re-regulation have brought along major changes in the regulated environment of utility industries, and particularly in the electricity sector. Nonetheless, the impact of these developments exhibits substantial differences. This article analyses the diverging impact of the market for corporate control (i.e. takeovers) on the evolution of the electricity sector in Britain and Spain. Takeovers have been prominent in the restructuring of the electricity sector in Britain. Every single privatised company has been acquired by foreign rivals in a short span of time. The Spanish electricity sector, in contrast, has been unequally exposed to takeovers: changes in ownership at Iberdrola and Union Fenosa were characterised by a friendly transition while Endesa has been acquired by Enel despite the preferences of Spanish policy-makers for the building of national champions. The argument presented in this article stresses the continuing importance of three key national institutions of corporate governance –ownership structures of listed companies; the system of corporate law and its associated voting rights procedures; and the degree of independence of regulatory authorities.