Worksharing and access discounts in the postal sector with asymmetrics information

Abstract

This paper analyses the optimal worksharing discount granted to mailers and entrants in a liberalized postal sector when there is asymmetric information about the Post Offices costs. When the regulator is unable to ascertain which part of the total cost of sorting has to be attributed to each sorting facility, the optimal access discount given to the entrants is set in a procompetitive way, thus facilitating the entry of firms that are less efficient than the Post Office. However, with the same asymmetry of information, the optimal worksharing discount given to the mailers is set to favor the Post Office, even when it is less efficient than the mailers in providing the sorting.postal sector, worksharing discounts, competition, access pricing