Regulation of Markets
- Regulation is the process of monitoring and enforcing the laws
- Governments create rules to limit harm from negative externalities of consumption/production and to create competitive markets
- Regulatory agencies monitor that the rules are not broken
- There are more than 90 regulators in the UK
- Individuals or firms may be fined/imprisoned for breaking the rules
- Industries such as water, telecoms, energy and the financial sector are regulated
- Examples of some industry regulators include Ofgem (Energy), Ofwat (Water) and the Financial Conduct Authority (Financial markets)
The Advantages & Disadvantages of Regulation
Advantages |
Disadvantages |
|
|