Restructuring Sweden's Railways : The Unintentional Deregulation

Abstract

In 1988, Sweden made a vertical cut in its nationalised railway monopoly; since then, infrastructure is handled by a public-sector agency while trains were initially run by a government-owned monopolist. This paper seeks to describe this reorganisation, the subsequent process towards free entry and competition in parts of the sector and the consequences of these changes. It is argued that the policies have not focussed on (ticket) prices and competition issues and have rather been directed towards the sector's inability to recover costs, which seems to be a Europe-wide phenomenon. Some recommendations for further changes of the industry are suggested.