Regulatory Failure and Renewal: The Evolution of the Natural Monopoly Contract, Second Edition

Regulatory Failure and Renewal explores the choice of regulatory instruments used in Canada for natural monopolies from the 1880s to the 1930s, comparing Canadian experiences to US approaches. It demonstrates that public enterprise arose due to reoccurring failures in the contractual process between the Canadian state and private enterprise, rather than as part of a purposive choice.

Format: Paperback / softback
Length: 168 pages
Publication date: 31 May 2022
Publisher: McGill-Queen's University Press

The book develops a comprehensive framework to understand the selection of regulatory instruments employed in Canada for natural monopolies, including telephone companies, water utilities, streetcars, hydroelectricity, and railways, from the 1880s to the 1930s. Drawing upon the transaction-cost literature pioneered by Oliver Williamson, John Baldwin delves into the nature of contractual failures in natural monopoly cases in Canada. He explores why initial forms of contracts between the state and private enterprise often failed and why this failure frequently led to the adoption of public enterprise. Baldwin provides an insightful overview of early attempts to address natural monopolies, ranging from the use of franchise contracts to regulatory tribunals and ultimately to public enterprise. He compares Canadian experiences with US approaches, which tended to rely more frequently on regulatory tribunals. This difference arises from Canada's more limited constraints on the state's ability to exercise coercive power, which sometimes resulted in contractual failures that necessitated the replacement of franchise and regulatory frameworks with public enterprise.

Regulatory Failure and Renewal underscores that public enterprise emerged not as a deliberate choice but as a response to recurring failures in the contractual process between the Canadian state and private enterprise. The book offers a valuable contribution to our understanding of the historical development of regulatory policies and their impact on the structure and operation of natural monopolies in Canada.

Dimension: 267 x 206 (mm)
ISBN-13: 9780228011828
Edition number: Second edition