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Christian Yvo Jaag
Former Member
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Jaag
First name
Christian Yvo
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http://ideas.repec.org/e/pja92.html
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1 - 10 of 38
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PublicationEntry Deterrence and the Calculation of the Net Cost of Universal Service ObligationsThis paper relates to the current discussion about how to measure the net cost and the unfair burden of universal service provision in network industries. The established profitability cost approach compares the profit of a universal service provider (USP) with and without a universal service obligation (USO). This paper argues that the net cost of universal service provision critically depends on the regulatory counterfactual and hence the USP's strategy space without USO. On the one hand, a strong USO limits the USP's means to position itself in the market, which offers cream-skimming opportunities and invites competition. On the other hand, a simple game-theoretic entry analysis shows that the USO may effectively serve as a valuable strategic commitment device to deter entry. Hence, the USO may be valuable to the USP despite causing inefficient operations. From a policy perspective, this constitutes a counter-intuitive result for the definition of the USO: the stricter it is regulated, the more detrimental it may be to competition and, therefore, the smaller is its burden on the USPType: journal articleJournal: Review of Network EconomicsVolume: 10Issue: 1
Scopus© Citations 7 -
PublicationThe interaction between universal service costing and fincancing in the postal sector : A calibrated approachThe financing of universal service provision in the postal sector has traditionally relied on granting the universal service provider a reserved area. Together with growing electronic substitution, current liberalization policies promoting competitive entry may put the traditional universal service at risk. Hence, there is an increased interest in knowing the cost of universal service provision. The third EC postal directive proposes a calculation approach to separately determine the net cost of a universal service obligation and to compensate the universal service provider (USP). This paper discusses the interaction between universal service costing and financing and shows that the EC approach may result in distorted results. It also quantifies the effects based on a model calibration with Swiss data. The results show that separate costing and financing leads to a considerable under-compensation of the USP if there is a compensation fund to which every operator contributes. The USP is over-compensated if it is exempt from contributing to the fund (pay or play mechanism). The problem of under- or overcompensation can be resolved by an integrated computation of the net cost that includes the competitive effects of the financing mechanism. Such an integrated approach results in a fair compensation of the USP.Type: journal articleJournal: Journal of Regulatory EconomicsVolume: 39Issue: 1
Scopus© Citations 12 -
PublicationAging and the Financing of Social Security in SwitzerlandDemographic projections forecast a doubling of the dependency ratio until 2050 as well as an increase of 10% in population due to longer life expectancy in Switzerland. To quantify the effects on social security and public finances, we use a computational overlapping generations model with five margins of labor supply: labor market participation, hours worked, job search, retirement, and on-the-job training. Starting with a passive fiscal strategy, we find that aging might reduce per capita income by 20 percent and necessitate a long-run increase of wage taxes and social security contributions by 21 percentage points. A comprehensive reform package, including an increase in the effective retirement age to 68 years and several other measures, may limit the tax increases to 4 percentage points of value added tax and reduce the decline of per capita income to less than 6%. Persistent link: http://EconPapers.repec.org/RePEc:ses:arsjes:2011-ii-3Type: journal articleJournal: Swiss Journal of Economics and StatisticsVolume: 147Issue: 2
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PublicationRegulatory Governance Costs in Network Industries : Observations in the Postal SectorThe various actors in the regulated industries relate to each other within a broader institutionalf ramework, i.e., by way off ormal and informal rules. An important role in the implementationo f liberalizationp rocesses is given to regulation and thus to regulatory institutions. The rationale for regulation is its positive effect on society by correcting market failures. But regulatory intervention also causes costs which we call "costs ofregulatory governance". These costs resultfrom negative consequences caused by regulatory requirements and from the implementation of regulatory instruments. These costs will depend upon the formal and informal rules among the involved actors, upon the allocation of property rights among these actors, as well as upon the various principal-agent or more generally contractual relationships among these actors. We distinguish between direct and indirect costs of regulation: Direct costs occur in relation with the institutional design of the regulatory framework and the behaviour of actors. Indirect costs resultfrom distorted incentives and finally turn out in an inefficient supply ofgoods and services. Using the example of the Swiss postal market we offer a first outline of a possible application of the framework. In this article we neither intend to quantify regulatory costs nor do we question regulation per se. We rather present a qualitative framework which helps to structure a discussion about regulatory challenges in network industries.Type: journal articleJournal: Competition and Regulation in Network IndustriesVolume: 11Issue: 2
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PublicationRegulatory risk in the tendering of railIn this paper we discuss the regulatory risk associated with tendering regional public transport lines from the regulator's and the operators' perspective.Type: journal articleJournal: Network Industries QuarterlyVolume: 12Issue: 3
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PublicationPostal Markets and Electronic Substitution : What is the Impact of Intermodal Competition on Regulatory Practices and Institutions?There is an increasing convergence between postal products and telecom applications which suggests the need for a co-evolution of regulation. But there is hardly any discussion in academia or in practice about the consequences for regulation. Relevant questions are: Which parts of current regulation will become redundant? Is there additional regulation needed due to new bottlenecks or changes in consumer behavior? In our qualitative analysis, we investigate the implications of intermodal competition and growing convergence between postal and telecommunications services on regulatory institutions and regimes. We set up a comparison between the networks and compare the scope of universal services and issues concerning market power regulation in the two different industriesType: journal articleJournal: Competition and Regulation in Network IndustriesVolume: 11Issue: 4
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PublicationPension reform, retirement, and life-cycle unemploymentThis paper investigates the labor market impact of four often proposed policy measures for sustainable pensions: strengthening the tax benefit link, moving from wage to price indexation of benefits, lengthening calculation periods, and introducing more actuarial fairness in pension assessment. We consider the impact on three margins of aggregate labor supply, retirement behavior, job search, and hours worked.We provide some analytical results and use a computational model to demonstrate the economic impact of recent pension reform in Austria. Reducing the distortion in the retirement decision by introducing pension supplements and discounts conditional on the chosen retirement date promises the largest gains.We also find that the pension reform is far from sufficient to offset the fiscal implications of projected demographic change in Austria.Type: journal articleJournal: International Tax and Public FinanceVolume: 17Issue: 5
Scopus© Citations 20 -
PublicationEducation, demographics, and the economyThis paper deals with two issues concerning the effects of population aging on education decisions in the presence of a PAYG pension system: We first analyze the effects of an aging population per se on individual skill choices and continuous education and the production structure. Second, we study the implications of postponed retirement, which is often proposed as a measure to cope with the economic challenges of increased longevity. Our study uses a dynamic general equilibrium framework with overlapping generations and probabilistic aging. The model allows for capital-skill complementarity in the production of final output. As a response to population aging, in a small open economy with a fixed interest rate, our first simulation shows that GDP is depressed due to an adverse effect on skill choice and labor supply. We then introduce postponed retirement as a potentially dampening policy measure due to its encouragement of human capital formation. However, since there is less private saving in this scenario, the overall effect on GDP is even worse than in the pure aging scenarioType: journal articleJournal: Journal of Pension Economics and FinanceVolume: 8Issue: 2
Scopus© Citations 8 -
PublicationTendering Universal Service Obligations in Liberalized MarketsIn the past decades, several countries have introduced reverse auctions for allocating universal service or public mission subsidies in various industries. Examples include urban transport, air transport and telecommunications. Recently, such mechanisms have also been envisioned in liberalized postal markets. Issuing an invitation to tender for obligations in otherwise liberalized markets significantly differs from auctioning off a monopolistic provision of services or goods ("competition for the market"), as is e.g. the case with spectrum auctions in the telecommunications sector. We discuss the rationale for introducing such a regulatory regime as well as conceptual and practical issues concerning its implementation.
It turns out that designing an efficient tender for universal service subsidies in liberalized markets is considerably more difficult than tendering e.g. a monopoly franchise. A first reason is that the cost assessment is more complex in the former case as future competitive market outcomes have to be anticipated; in the case of franchise bidding, at least the number of competitors is given by the tender itself. Hence, revenue effects caused by competitors are easier to calculate. Second, the threat of a winner's moral hazard requires more detailed ex ante regulations. These raise the social cost of universal service provision. Compared to direct designation of universal services with ex post compensation, tendering causes a series of fundamental concerns and trade-offs that make the application of auctions less attractive than in other sectors.Type: journal articleJournal: Competition and Regulation in Network IndustriesVolume: 10Issue: 4 -
PublicationType: journal articleJournal: Revue d'Economie IndustrielleIssue: 127