Pateiro Rodríguez, Carlos Prado Domínguez, Javier García Iglesias, Jesús M.
Year of Publication:
[Journal:] Atlantic Review of Economics [ISSN:] 2174-3835 [Publisher:] Colegio de Economistas [Place:] La Coruña [Volume:] 2 [Year:] 2011 [Pages:] 1-27
This paper focuses on the problems posed by the uniform price and market cream skimming in a context in which the incumbent is restricted asymmetric prices and products and analyzes the risks of a graveyard spiral process. We point that the price elasticity of demand, the brand loyalty and the adoption of policies promoting competition in the long term versus short-term approach can mitigate the financial problems of the universal service obligations (USO). Also, with the same objective we examined the role of a hypothetical relaxation of the universal postal service standards in the current context of rapid replacement of traditional mail by modern telecommunications.