by: Ashley Meadows, Keaton Miller and Logan Yeo
Definition: Economic Regulation is a type of government regulation that sets prices or conditions on entry of firms into an industry.
Regulation often encounters conflict between maximizing profits and the people using services or goods. That is why the government has some form of control or regulation to prevent these possible conflicts. It is important to maintain a balance of safety and appropriate services but also while not being detrimental to the functions and developments of a business.
Examples of Regulation include:
- The sale and consumption of alcohol and prescription drugs
- Public transportation
- The food business
- Provision of personal or residential care
Between the 1970's and 1980's some regulations were deemed unnecessary and restricting to businesses. Others were said to have decreased economic efficiency. An example of this is the international monetary system. Now it has become much easier to transfer currencies and as a result, the globalization of markets has increased.
Economic regulation continues to be debated today while the efficiency and quality of businesses continues to improve.