The Price of Postage

In a way it seems like a small fee to pay 42 cents to send a piece of paper from one side of the U.S. to the other. The same goes for sending a letter from one end of Sweden to the other, or indeed for a lot of other countries. But is it a small fee? Don Boudreaux, of George Mason University, thinks not.

It has been suggested that, because the nominal price of first-class postage is about where it was in the late 18th century, Americans who complain about the proposal to increase postal rates are merely whining wimps who are lacking in historical perspective.


Given the plunge in transportation costs, joined with other technological improvements and a large increase in the scale of postal activity, the price of postage should have fallen dramatically.

Why is it that regulation and monopolies are not removed in this area? It does not have the vote winning appeal of health care, or booze and gambling, and it does not bring in vast amounts of revenue to the government either. Despite this a lot of countries have postal service monopolies.

Certainly, it is not the most important thing to relieve from the hands of government, but there seems to be no reason not to.

As a side note, I haven’t been blogging very consistently lately. This is due to having been rather busy lately. It might be slow for a little while longer, but I’ll post new blogs whenever I can.


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One thought on “The Price of Postage”

  1. I’m always surprised at the amount of people who complain about postage prices, but still support the government monopoly structure in principle. It is just another example of the poor understanding of economics that is prevalent in our society.

    It reminds me of the suggestion some years ago about figuring out a way to tax users for e-mail, as the US Post Service was supposedly losing a significant amount of money to internet-based correspondence. The tax revenue would then be used to supplement the USPS and keep it afloat. I’m glad somebody nipped that in the bud.

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