Competition in network industries faces particular problems which are analyzed from both a theoretical and policy perspective. Issues of vertical integration, deregulation and privatization are covered. While competition and privatization are rapidly unfolding in telecommunications in Western and Eastern Europe, energy and railway transportation represent sectors of more gradual liberalization. The different market characteristics of telecommunications, energy and transportation raise consistency problems in the fields of deregulation, investment strategies and internationalization. While transformation policies create opportunities for liberalization in Eastern Europe and Russia the latter shows critical problems in ending monopoly and state ownership. Network industries could be subject to competition and promise major investment opportunities plus consumer benefits.

In this ambitious book, the authors challenge mainstream economic theory to present a new theoretical concept on modern economic reality. The book reveals in detail the key notions of the sociodynamic multiplier and the rational behavior of the state.

In this ambitious book, the authors challenge mainstream economic theory by reconsidering the principle of individualism as its foundation. They refer to that version which fails to recognize the existence of the interests of society as such, and thus excludes the role of the state as an independent market player seeking to realize these interests. The outcome is a new theoretical concept called "Economic Sociodynamics." The book reveals this concept in detail, in particular its key notions of the sociodynamic multiplier and the rational behavior of the state.

This book contains the main results of INDEUNIS, which is an international research project coordinated by the Vienna Institute for International Economic Studies and financed by the European Commission under its Sixth Framework Programme. Researchers from Austria, Poland, Hungary, Estonia, Finland, Russia, Belarus, Kazakhstan, and Ukraine have jointly investigated recent experiences with economic transition, restructuring, and integration. There is a set of non-exclusive policy options for the NIS (Newly Independent States) which include being able to proceed with the liberalization and institutional development process, to provide more government budget for renewing and expanding infrastructure, to establish an Industrial Policy to promote priority sectors, and to use tariff and other protection for temporary support to infant-industries. The bottom line on the experience of structural change and policy implications for the future is that the NMS (New EU Member States) provide an object lesson for the NIS. The major component of NMS' success has been the steady progress in market reforms, including liberalization, all with a small lag in institutional development. The best recommendation for the NIS is to follow the same path, despite the problems early delay has caused.