Regulation, open-access transportation, and productive efficiency

This paper examines the initial impact of open-access transportation on fir m efficiency. Under open-access transportation, firms provide transportatio n service for a general class of customers on a non-discriminatory basis. O pen-access transportation may enhance competition among firms, and lead to increases in firm efficiency as well as lower prices for consumers. The tra nsportation program's impact on productive efficiency is tested using a 197 7-1989 panel of 20 U.S. interstate natural gas pipeline companies. Results indicate that the program led to (i) a small reduction in transportation co st, and (ii) small increases in firm efficiency.