Freedoms of the air? Liberalising aviation for the long haul

As moves towards more liberalised global air travel tentatively progress, Alex Plant, Head of Economic Policy and International Aviation, UK Civil Aviation Authority, assesses the benefits of European and US reforms to the long-standing ‘bilateral’ system, and considers the prospects of a fully competitive international market

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Watching the watchdog: the NAO’s review of the OFT

In recent years, the powers and resources of the UK Office of Fair Trading have been significantly enhanced. Yet how effective is it as the guardian of consumer interests and fair and competitive business practices? Peter Langham and Louise Campbell of the National Audit Office discuss a new report on the OFT's organisational performance.

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Fine-tuning RPI – X: the impact of changing the incentives mechanism

One advantage of RPI – X regulation is the incentive it places on companies to improve efficiency. If companies operate more efficiently than assumed when prices are set, they retain the benefits for the remainder of the review period. However, the UK experience has been to make various reforms to this ‘basic’ incentive with the aim of improving productivity. Has changing these incentive mechanisms led to increased productivity in the water industry?

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Protecting consumers: is competition policy enough?

Competition policy and consumer protection policy are both meant to serve consumers, but there are tensions between the two. Dr Helen Jenkins, Oxera Director, illustrates these tensions, discussing some of the recent market investigations carried out under the new competition policy framework in the UK (the Enterprise Act 2002). The remedies proposed in those investigations protect consumers, but perhaps do not go as far as a consumer protectionist approach would.

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Accentuating the positive: sharing financial data between banks

From 2006, all major UK banks will start sharing 'positive' data on their customers, such as details relating to loans and credit availability. Until now, only ‘negative’ data has been shared, such as that pertaining to arrears and bankruptcies. What is the likely impact of this new policy on the banking market? Will it help to reduce over-indebtedness? And what happens in other European countries?

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Where has the innovation gone? R&D in UK utility regulation

If current trends continue, the UK economy may suffer as the effects of reduced R&D effort in key infrastructure sectors feed into lower productivity growth throughout the economy. Liberalisation, the design of the regulatory regime, and changes in utility financing may all help to explain the trend for falling R&D intensity across most utility sectors. This article examines several options for regulatory reform to address these challenges

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Margin for error? security of supply in electricity

Electricity supply security relies on sufficient and timely investment in generation and network infrastructure. Market liberalisation is placing the responsibility for ensuring security firmly on the private sector, but how can we be sure that markets are investing appropriately? A benchmark is needed against which to monitor market performance

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Public information, private profit: how should government agencies compete?

Public sector agencies are the largest producers of information in Europe. This information has been recognised as an under-exploited asset, worth around €68 billion per year. The European model is to charge companies for public sector information, whereas US government agencies typically distribute data for free. From a public policy perspective, what are the effects on competition and efficiency of trying to recover the costs of public information from the private sector?

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Competition as a public policy tool: what is the evidence?

A key priority for the government is to increase UK productivity by extending competitive markets. Competition helps drive productivity by acting as a spur to managerial incentives and productive efficiency through ‘natural selection’ of firm entry and exit, and by promoting incentives to innovate. However, as Andrew Rees, Director, Analysis and Research, Consumer and Competition Policy, DTI, and Sasha Maguire, Economist, DTI, explain, recent evidence on these effects is perhaps less well known

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Efficiency and competition policy: an unconventional view

Where are the inefficiencies—in production, in allocation of resources, or somewhere else? Adriaan ten Kate, Head of the Economics Directorate at Mexico's Federal Competition Commission, addresses these questions. He explains why the greatest harm to welfare may come from 'lost opportunities'—transactions that never materialise—and points to some important lessons for competition policy

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In sickness and in health: improving the analysis of healthcare mergers

Market-based healthcare reforms in many countries are resulting in mergers between healthcare providers such as hospitals. Assessing the competitive effects of these mergers is far from straightforward, especially in the area of geographic market definition. However, some techniques used to define the relevant geographic market are better than others. Using the most robust methods can make the difference between a merger being approved or being blocked

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Was it worth it? How to evaluate policy

There is a growing need for robust ex post evaluation of policy interventions, the impetus for which is a desire by policy-funders for more effective accountability and decision-making. This article suggests that evaluation is not fraught with difficulties, as is often perceived to be the case, and sets out how a successful evaluation could be designed, building on Oxera's recent work for the UK Department for Transport

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