Economic Regulation
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Market developments have introduced competition into several network industries, including telecoms, energy, and posts. Combined with the introduction of ex ante regulatory remedies, competition has in some sectors resulted in extensive price reduction and substantial increases in demand. Considerable capital investment in capacity and infrastructure has often been required where this has occurred.
Competition has had many positive effects for providers and consumers, but over time it has changed market structures from simple to complex and increasingly fluid and dynamic. Governments, authorities, corporations, investors, and law firms rely on rigorous economic analysis to inform decisions or address challenges. However, it is increasingly necessary also to review the underlying assumptions and market models, many of which may no longer be appropriate. Such reviews may result in revisions to the regulatory toolkits and remedies used by regulators. Examples of change include the very different levels of risk providers face now, compared to when liberalization commenced.
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