Introducing competition into regulated network industries: From hierarchies to markets in Canada's railroad industry.

摘要

In this paper I use Williamson's (1979) transaction cost-based analytical framework to take a fresh look at the running rights debate in Canada's railroad industry. I show how the current form of industry governance, classic vertical integration, results in an inefficient use of rail transport. I also reveal the limitations of the traditional open access policy prescriptions advanced in the running rights debate. I then develop a new governance structure for Canada's railroad industry: auction-based governance. I demonstrate that this form of governance is tractable and achieves a balance between the sustainability of the industry and the welfare of shippers.