The Economic Way of Thinking 13th Edition by David Prychitko, Peter Boettke, Paul Heyne

Exercise 16

Before 1980, the Interstate Commerce Commission rarely granted new permits to trucking firms to haul goods interstate, and operating rights were often extremely valuable. They were listed as assets on the books of trucking companies and made up a significant part of the purchase price whenever such companies were sold.
(a) What factors established the market value of such operating rights?
(b) When the Motor Carrier Act of 1980 took effect, allowing much easier entry into interstate trucking, the market value of operating rights fell. Why?
(c) Was this fall a loss?
(d) Losses as well as profits are the consequence of uncertainty. What was the uncertainty that produced this loss for trucking companies in 1980?
(e) What would have happened to the value of operating rights in the 1970s if everyone had known 10 years in advance that Congress was going to ease restrictions on entry into interstate trucking after 1980?
(f) The Motor Carrier Act of 1980 was a change in the rules of the game. Which were the principal property rights affected, and with what consequences?