The Effects of Liberalization Policies on Price and Quality of Services in the European Union Postal Market

Abstract

This study examines the effects of postal services liberalization and postal market characteristics such as productivity and population density on sector performance indicators of price and quality of service for the EU-27 countries. The EU-27 countries are classified into two groups according to the existence of legal monopoly: high degree and low degree of market opening countries. The results, based on a cross-section country level data belonging to the EU-27 countries for the year 2010, indicate that there is not a statistically significant relationship between the degree of legal openness in the market and performance indicators of price and quality of service. Our analyses show that labour productivity is a key factor which has a statistically significant negative impact on prices and positive impact on quality of services.