Table of Contents

Handbook of Worldwide Postal Reform

Handbook of Worldwide Postal Reform

Advances in Regulatory Economics series

Edited by Michael A. Crew, Paul R. Kleindofer and James I. Campbell Jr

The postal and delivery sector has been the subject of considerable interest in recent years. This Handbook brings together a number of contributions directed at understanding developments in the field of postal reform. The authors review the experience and plans of individual countries to provide some perspective on the problems faced in the area and the varied approaches being taken to address it. They also review key elements of policy and strategy that are important in this debate.

Chapter 3: Pricing for Postal Access and Worksharing 

Michael A. Crew and Paul R. Kleindorfer

Subjects: economics and finance, public sector economics


3. 1. Pricing for postal access and worksharing* Michael A. Crew† and Paul R. Kleindorfer‡ INTRODUCTION This chapter evaluates approaches to setting access prices and worksharing discounts by postal operators (POs). POs are typically synonymous with universal service providers (USPs), so the terms are used interchangeably here. In the postal sector, the term ‘worksharing’ is used to describe what is known more generally in network industries as access pricing. As with other network industries, access to a postal network can occur at multiple stages, but it is usually referred to in the postal sector as either upstream or downstream access. The latter refers to access to the regional or local delivery network; for example newspaper or periodical publishers might print and address their publications and then deliver them in bundles to local post offices for final delivery. Competitors of the PO may also use downstream access provided by the PO to complete their coverage offerings for high-cost areas. All other types of access are deemed upstream access. Upstream access activities are also referred to as ‘worksharing’. These include collection, consolidation, presorting, barcoding and transportation undertaken by customers or mail preparation companies in advance of tendering the mail to the PO. While there are some important differences in costing and pricing of upstream and downstream access, this chapter will treat both of them under the umbrella of access pricing, drawing distinctions as needed. The notion of access implies that worksharing activities by customers or third parties have been...

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