Regional economic effects of liberalisation in air and postal services

Deregulation and increased competition have not had negative effects on the level of service in sparsely populated regions in Norway up to now. The reason is the Public Service Obligation arrangements and the opportunities they offer to regulate price and quality of the services. Using this instrument and the public ownership of airports and the main operator in the postal sector, it will also be possible to reach regional objectives in the future while opening up for more competition. The exclusive rights of the main postal operator can be abolished without negative effects. Prices may be differentiated according to the destination of letters. In that case, prices should be lower for post to sparsely populated areas than for post to densely populated areas.