Deregulation

Deregulation is the process by which governments remove selected regulations on business in order to (in theory) encourage the efficient operation of markets. The theory is that fewer regulations will lead to a raised level of competitiveness, therefore higher productivity, more efficiency and lower prices overall. Deregulation is different from liberalization because a liberalized market, allowing any number of players, can be regulated to protect the consumer's rights, especially to prevent de facto or even legal oligopolies.

Related Topics:
Regulation - Business - Productivity - Efficiency - Liberalization - Consumer - Right - De facto - Oligopolies

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Perceived failures of deregulation (such as the failure of the Savings & Loan sector of the U.S. during the 1980s) have encouraged re-regulation, and more balanced approaches to regulation that emphasize the quality of regulation over the quantity. That is, instead of simply removing (or adding) regulations on business, the point is to regulate business intelligently, using as sophisticated an economic theory as possible.

Related Topics:
Savings & Loan - Economic

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One problem that encouraged deregulation was the way in which the regulated industries often controlled the government regulatory agencies, using them to serve the industries' interests. Unfortunately, the deregulation process itself was often controlled by the regulated industries.

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