Subject category:
Ethics and Social Responsibility
Published by:
Harvard Kennedy School
Length: 11 pages
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https://casecent.re/p/7268
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Abstract
In 1988 Casco Bay Ferries, a publicly owned ferry line that serves the islands in Casco Bay off Portland, Maine, faced a challenge from private ferry operators who were requesting permission from state regulatory authorities to start competitive service. Casco Bay Ferries was worried that these new competitors would choose to serve only the lucrative summer vacation market, leaving the public company with the unprofitable winter service. The case can be used to discuss pricing principles for a public enterprise, cost allocation between different types of products (including peak period costing and pricing), and the nature of monopoly and barriers to entry.
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Abstract
In 1988 Casco Bay Ferries, a publicly owned ferry line that serves the islands in Casco Bay off Portland, Maine, faced a challenge from private ferry operators who were requesting permission from state regulatory authorities to start competitive service. Casco Bay Ferries was worried that these new competitors would choose to serve only the lucrative summer vacation market, leaving the public company with the unprofitable winter service. The case can be used to discuss pricing principles for a public enterprise, cost allocation between different types of products (including peak period costing and pricing), and the nature of monopoly and barriers to entry.