Analysis of the Relationship between Competition Policy and Economic Regulation Free Essay Example, 2250 words

Hence many countries and regions are now following the deregulation by trying to implement the best practices in other systems and avoiding the worst mistakes. A major problem with the deregulation is that it is based on a very weak logical foundation for improving efficiency. In the absence of competition, this may not be the case. It is important to note that the study of regulation cannot be done in isolation. It has to be studied in the social, political and economic context in which it exists. The relative powers of different interest groups play their part in formulating and shaping the regulations. Different regulatory mechanisms interact with each other and once implemented they play an important role as the motives of decision makers. A thorough understanding of the regulatory process is thus not possible without considering specific institutions, political structures and actors. According to this theory, government intervention or regulation is required only in case of mar ket failure when a market is unable to achieve a particular social object such as equality. Government intervention is needed to correct this failure. We will write a custom essay sample on Analysis of the Relationship between Competition Policy and Economic Regulation or any topic specifically for you Only $17.96 $11.86/page The various tools of economic regulation are (Chris J Dolan)The two basic purposes of regulatory body are a promotion of conditions essential for the efficient working of marketplace and prevention of socially undesirable outcomes. These two purposes may not always be complementary.