4. market failure and government intervention

Question 1

collusion

Answer 1

energy industry are highly suspected of colluding

Question 2

Government intervention to increase competitiveness

Answer 2

-BT used to own the majority of the fibre-optic cable network which gave them are monopoly power. as a result, the OFGEM, in 2015, forced them to open up the cable network to competition
-in 2015, the CMA blocked a merger between sainsburys and ASDA as the firms could have gained monopoly power

Question 3

regulatory capture

Answer 3

2016, there was public outcry as energy companies stopped showing how much. profit they made off of each house hold. OFGEM sided with the firms without sufficient justification

Question 4

deregulation

Answer 4

postal services, deregulation occurred which allowed for greater competition as there were lower barriers and so new firms found more innovative ways to lower costs

Question 5

privatisation

Answer 5

prior to the water industries privatisation, water quality was very poor, but once privatised there was an initial investment of $160 billion to improve the quality