Regulation of liberalised network industries: infostructure as a missing link

Abstract: The aim of this paper is to evaluate how infostructure has been reformed in the liberalisation process of network industries, which has involved third party access to the network through a comparison of the electricity, railway, and civil aviation sectors in Switzerland. Our theoretical argument posits that infostructure is a missing link in the study of the regulation of liberalised network industries. Infostructure is defined as the control and command services that are necessary for monitoring the access to and optimising the uses of infrastructure. Our empirical comparison of the sectors aims at answering the principle question: What is the impact of the management of infostructure on the liberalisation process and the structure of liberalising markets? This study of the liberalisation of network industries in Switzerland highlights the potential strategic function of infostructure in the context of opening to competition and internationalising markets. Infostructure management can impact infrastructure ownership and service operation in terms of market structure and constrain access to the infrastructure and the market. Infostructure could also weaken the capacity to regulate the entire sector from regulatory agencies, particularly when self-regulatory arrangements control third party access to the network