The Regulation of Natural Monopolies Goes Ahead Market Development

Abstract

There are three most significant problems for infrastructure sectors of Russia's economy: determination the boundaries of markets for natural monopolies; considerable reduction the scale of cross-subsidization, and attraction of public and private capital into the infrastructure sectors. In this respect, the latest Government initiatives for establishing united natural monopolies regulator seem to outstrip market development. In our view, denoted problems rather than questions about the agency that should make the decisions on the regulation of natural monopolies should be overriding in government policy related to natural monopolies.

Keywords: Russian economy, natural monopolies, cross subsidization

JEL Classification: D42