References (21)



Against the Stand-Alone-Cost Test in U.S. Freight Rail Regulation

Russell W. Pittman

U.S. Department of Justice - Economic Analysis Group; New Economic School (NES)

April 9, 2010

The stand-alone-cost test has become an expensive, extensive, and time-consuming part of the regulatory practice of the U.S. Surface Transportation Board in the performance of its statutory duty to protect "captive shippers" from monopoly rail rates. Worse, a close examination of the history of its adoption and application suggests only a very tenuous connection with its claimed intellectual foundations, the classic works of Faulhaber (1975) and Baumol, Panzar, and Willig (1982). It is time to retire this tool and replace it with something simpler and more effective and transparent.

Number of Pages in PDF File: 16

Keywords: railroads, freight, regulation, Stand Alone Cost Test, Surface Transportation Board

JEL Classification: K23, L51, L92

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Date posted: April 11, 2010  

Suggested Citation

Pittman, Russell W., Against the Stand-Alone-Cost Test in U.S. Freight Rail Regulation (April 9, 2010). Available at SSRN: http://ssrn.com/abstract=1587004 or http://dx.doi.org/10.2139/ssrn.1587004

Contact Information

Russell Pittman (Contact Author)
U.S. Department of Justice - Economic Analysis Group ( email )
450 5th St. NW
Antitrust Division
Washington, DC 20530
United States
202-307-6367 (Phone)
202-307-3372 (Fax)
New Economic School (NES) ( email )
47 Nakhimovsky Prospekt
Moscow, 117418
Feedback to SSRN

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