Ecomomic Regulation or competition policy Research Paper

Ecomomic Regulation or competition policy - Research Paper Example The relationship between Competition policy and Economic regulation will also be discussed. Comparison of the two approaches and the synergies that it will bring if both are used by the same agency. We also discuss some other concepts which include AJ effect and rate of return regulation. Literature Review In this literature review we will discuss in detail various concepts related to the topic. Economic Regulations George Stigler was the pioneer of the theory of economic regulation. He suggested that as rule regulations are designed in such a way that they benefit the industry who acquire them rather than protecting or benefitting the public. (Vane) He integrated the economics of regulation and economics of politics. According to him same analysis tools should be applied to both because both of them display self interested rational behavior. Economic regulation is a form of antitrust law in traditional economics through which concentration of wealth is controlled. The major objectiv e was that private motives of accumulation of wealth do not hurt the public interest. It was introduced to safeguard public interest. The intension was to protect public from economic abuses such as unreasonable prices, anticompetitive activities, to protect from sale of unethical products which are hazardous for health and safety of the public. The basic role of regulators was of the watchman of the public interest. In addition to that the role of regulators is of preventing monopoly and preserving competition. (Cochran) Background The regulatory scene which we witness today is significantly different from what it was in 1980’s. This phenomenon is due to massive privatization which gave birth to new regulatory apparatus. This process of privatization is now an international affair. Hence many countries and regions are now following this deregulation by trying to implement the best practices in other systems and avoiding the worst mistakes. A major problem with the deregulati on is that it is based on very weak logical foundation of improving efficiency. In the absence of competition this may not be the case. (Michael A Crew) Economic Regulation Theories It is important to note that 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 regulatory process is thus not possible without considering specific institutions, political structures and actors. Two major theories of government behavior about economic regulations are public interest approach and self interest theory or public choice theory. (Jan) Public Interest Approach According to this theory government intervention or regulation is required on ly to in case of market failure, when market is unable to achieve a particular social objective such as equality. Government intervention is needed to correct this failure. This approach is

The Fixer Essay Example | Topics and Well Written Essays - 2000 words

The Fixer - Essay Example This article will examine each of the actions taken by Alex Polizzi in different scenes that she visited. It has two seasons, each having six episodes. Season 1 Episode 1 In this episode, Alex Polizzi, an entrepreneur from the Courtyard Bridalwear, single handedly starts a campaign aimed at saving struggling families in the face of the prevailing tricky financial situations. Her first mission was on a Kettering based bridalwear business located in North Hamptonshire. A mother and her two daughters who are engaged in squabbles apparently run this business. Although, the business owner, Anne Preece has decided to remortgage her house to ensure that the business remains succeeds, a decline in profits is still evident. Besides, the business is obsolete, overstocked and seemingly weary. Furthermore, the frequent arguments by the daughters only help to worsen the situation. In order to save this situation, Alex must employ strategic business ideas in his endeavors to make the women reconsi der their feelings towards each other in the hope of turning the fortunes of the business. Apparently, conflicts form part of family businesses meaning that business managers must find appropriate strategies for dealing with them. Alex Polizzi indicates that an amicable relationship between the mother and her two daughters needs the development of formal management structures that would integrate standard practices and policies for managing their business. This would ensure that each person in the business has her duties and roles discretely defined. As a result, it would be simple to avoid cases of conflicts mainly caused by overlap of duties. Season 1 Episode 2 In this episode, Alex Polizzi focuses her attention to a family bakery owned by the Eades in Padstow Cornwall. This business enterprise is at the receiving end of low tourists visitations and holyday makers due to the winter situations that seem to affect business activities, as well as proceeds. Although, the business is o wned as a family, Elaine makes all the decisions of the business without the regard of her children, Luisa and Greg, who are both directors of the business. Subsequently, the business massively suffers from constant recriminations and arguments that slow its progression. It takes the intervention of Alex to instill business ideologies to Elaine’s husband and give him direction of running a business. Alex vehemently states that decision making at all levels should be an involving affair that requires participation of important stakeholders. This supposes that the mother and all her daughters must take part in the decision-making agenda. This would ensure that the decisions that are reached upon are all encompassing. An additional way of resolving such issues and ensuring that the business remains on course is ensuring that the members of the family who are involved in executing operations of the business are entitled to standard salaries. This will help minimize the rivalry in families when issues that pertain to finances arise. Season 1 Episode 3 In this episode, Alex Polizzi’s expertise comes in handy when she is called upon to help a furniture business located in Yeadon, West Yorkshire. Although the business has been in existence for more than three decades, it is now losing its customers at a very fast rate owing to its obsolete state. The Kettley’s Furniture Business also experiences communication breakdowns from its owners, John and