(b)  Regulating the network  The first diagnosed case of Human Immuno-Deficiency Virus (HIV) in the United States came in June 1981. The first diagnosed case of HIV in Australia came in November 1982. In the early 1980s, rates of HIV and AIDS incidence in the US and Australia were roughly similar on a per capita basis. But from the mid-1980s onwards, things changed. By 1994, rates of incidence in the US were six times those in Australia. By 2003, the per capita prevalence of HIV in the US was ten times that in Australia. 29 What explains these differences? The short answer appears to be government policy. In the US, the policy stance since the early 1980s has been largely theological. The preventative response has taken the form of moralising about sexual abstinence and monogamy. Since the mid-1990s, the US government has invested in the less contentious areas of HIV/AIDS treatment. But as recently as 2007, the US administration remained opposed to the provision of condoms or needle and syringe programmes to prevent the spread of HIV/AIDS. Australian policy since the early 1980s has, by contrast, been grounded in biology rather than theology. It has been systematic, with policy evidence-based and preventative. Education and prophylactic measures have been widely available. But there have been targeted initiatives for high-risk groups – for example, sex workers and drug users – through subsidised needle and syringe exchanges and free condoms. The results of this programme are clear in the statistics.
Norway experienced a rapid automation of the payment market after banks altered their pricing and began to implement transaction fees that better reflected banks’ own costs. In Sweden, the introduction of transaction fees for cheques contributed to bank customers’ increased use of debit cards. As for cash, Swedish banks do not implement any fees for cash withdrawals while such fees do occur, for example, in other Nordic countries. Thus, differences in pricing can be expected to be an important factor in explaining the differences we observe in the use of cash. Given this, the Riksbank together with the four major banks initiated a study on the pricing of payment services in Sweden. Together these four banks account for more than 90 per cent of the Swedish retail payment market. Our aim was twofold: we wanted to estimate the costs that banks have in the  1  Sveriges Riksbank (2004), “Prices and costs in the Swedish payment system”, in Financial Stability Report 2004:2. 2  Cheques are no longer in use in Sweden. 1/3  production of these services, and we wanted to see whether the price mechanism is working well; whether prices provide users with information on what the different payment alternatives cost. Cost and price estimates The study was based on both fixed and variable cost and price data from 2002. Normally we would assume that users receive correct cost information when they face transaction fees that correspond to marginal costs in production.