'Stepping Stones' and 'Access Holidays': The fallacies of regulatory micro-management

Abstract

The starting point of joint work with Beat Blankart was at those times when market entry was still forbidden by law in major parts of telecommunications networks in European countries. Therefore, it seemed to be a natural research question to ask what we can learn from comparative institutional analysis. How can one explain the extensive deregulation of interstate telecommunications in the U.S. compared to the lagging telecommunications deregulation intrastate in the U.S. and intracountry in Europe and in Germany in particular? It soon became aware that normative theory of economic regulation can not be sufficient to answer such questions. Rather a political-economy approach, taking into account the role of bureaucracy, has been indispensable (Blankart, Knieps 1989). In meantime market entry is allowed in all parts of telecommunications markets in the U.S. as well as in Europe. Nevertheless, sector-specific regulation still plays an important role. © 2007 Springer-Verlag Berlin Heidelberg.