Laperrouza, M. (2008) “Does liberalization increase systemic risk in the railway sector?”, presented at the 1st Conference on Competition and Regulation in Network Industries, 28 November 2008, Brussels, Belgium
In recent years various large-scale blackouts and incidents have shown that failures can have serious economic and social consequences in network industries. A large body of literature covers critical infrastructures (and their protection), but most of it is confined to a relatively restricted number of sectors such as electricity and information and communication technologies (ICT). In addition, much of this literature discusses questions of systemic risk in complex networks from an engineering perspective, attempting to mitigate risk through quantitative techniques.
While considered a critical infrastructure and sharing a number of characteristics with electricity (e.g. interconnection), the railway sector has received much less attention when it comes to systemic risk. In the wake of the creation of the single European railway market, legitimate questions to ask are whether/to what extent the liberalization of the railway system increases the sector?s systemic risk. The broader issue of the governance of systemic risk in the railway sector also deserves attention as existing mitigation of risk tends to be limited to risk management, often from a technical perspective, leaving aside an institutional dimension.