The Canadian Experience with Deregulation

This paper assesses the current state of deregulation in Canadian markets for telephony, electricity and airlines. It is an opportune time to review the Canadian experience. Enough time has passed since the inception of deregulation, and sufficient problems have arisen in the transition towards competition, that lessons are available. The problems are evident: shortages and consumer intolerance to high prices in electricity markets; a slow (relative to prior expectations) rate of entry of competitors into local telephone service; and bankruptcies in the airline industry. Yet enough distance remains in the transition towards greater reliance on markets, and uncertainty in even how far the transition will take us, that these lessons will prove valuable in the future