Models of Public Sector Information provision via Trading Funds (the ‘Cambridge Study’)
This study arose as a response to the government’s acceptance of the Power of Information Review study's recommendations. Carried out by distinguished economists and lawyers from Cambridge University, this study analysed the impact of adopting different models for the provision of public sector information by trading funds. Its basic task was to examine the cost and benefits for society, and the effects on government revenue, of four different charging policies: profit-maximisation, average cost (cost-recovery), marginal cost and zero cost; both on their own and when interacted with various data distinctions such as raw versus value-added, and unrefined versus refined. The study focused on the six largest trading funds by data provision.
The authors found that, for many products, limitations of data and/or ambiguities about the nature of the good itself (particularly the data/service divide) would have made the analysis so speculative as to be of little value. Based however on an analysis of the data made available to them and a series of assumptions – which they judged to be conservative – the authors generally confined their analyses to comparing the existing average cost (cost-recovery) regime with marginal cost. On this basis, they concluded that:
- In most cases, a marginal cost regime would be welfare improving (that is, the benefits to society of moving to a marginal cost regime outweighed the costs).
- A change in charging regime should not have a detrimental impact on the performance of trading funds in terms of efficiency or data quality, providing a suitable governance and regulatory regime is put in place.
Posted at Tuesday, February 26, 2008 11:33:40 AM (GMT Standard Time, UTC+00:00)