Regulation Flashcards
1
Q
Regulation and monopoly power
A
Avoids abuse of monopoly power
2
Q
Regulatory capture
A
Regulatory agencies may become dominated by the industries they are supposed to be regulating
Occurs when there is assymetry of information
3
Q
De regulation
A
Removal of regulation to promote competitiveness by reducing barriers to entry
4
Q
Customer inertia
A
Tendency of customers to remain with a provider due to information failure bounded rationality or customer loyalty
5
Q
Regulation of monopolies
A
Price capping - limiting price increases
Regulation of merges
Breaking up monopolies
Investigation into unfair prices
RPI- x allowed to increase prices but not exceed limitations
Nationalisation - govement ownership
