Postal Service in Scandinavia

When considering a policy issue like the quality of mail delivery it’s often intriguing to ask oneself “how is this done in Scandinavia?” What appears to be the case is that the government of Denmark quasi-privatized its postal services, creating an independent corporation called Post Danmark that’s partially owned by a private equity firm, partially owned by the firm’s employees, and partially owned by the Danish state.

Meanwhile, Sweden has a state-run postal agency but a deregulated market in postal services. So the state-owned Posten AB needs to compete with a firm called Bring CityMail. Bring CityMail operates as a private company in Denmark and Sweden, but it’s actually a subsidiary of the Norwegian state postal service. Meanwhile, in order to better compete with this Norwegian juggernaut, Sweden’s publicly owned postal service and Denmark’s semi-public postal service are merging to form Posten Norden AB. This is going to be organized as a private firm, though a large share of the ownership will be in the hands of the Danish and Swedish governments.

International mergers of postal agencies seem to have a certain logic when you’re talking about very small countries that doesn’t necessarily apply to the United States. But I would say that one key thing here relates not so much to state ownership versus non-ownership, but to a regulatory climate that seems designed to promote meaningful competition between different mail delivery services regardless of ownership structure.

Of course part of the story with the USPS is that it’s a way of having the majority of Americans who live in metropolitan area subsidize the rural minority. I assume this same issue exists in Sweden and Norway which contain US-esque large sparsely populated hinterlands and I don’t know how they handle it. Providing subsidies for rural living doesn’t strike me as a particularly worthwhile policy objective, but given the strongly pro-rural bias of our political institutions it doesn’t seem avoidable either.