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Government regulation

From Academic Kids

Government regulation involves the use of the law, mandated by the state, to produce outcomes which might not otherwise occur, prevent outcomes which might otherwise occur, produce or prevent outcomes in different places to what might otherwise occur, or produce or prevent outcomes in different timescales than would otherwise occur. Regulations rarely produce complete outcomes or prevent outcomes completely but they generally do modify what would otherwise take place. Common examples of regulation include attempts to control market entries, prices, wages, pollution effects, employment for certain people in certain industries, standards of production for certain goods and services.

Generally speaking regulations have costs for some and benefits for others. Efficient regulations may only be said to exist where on average their total benefits exceed their total costs.

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