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Homework answers / question archive / Government regulation often pursues a variety of goals simultaneously
Government regulation often pursues a variety of goals simultaneously. Some of these goals may not be explicitly identified or acknowledged. In the process of establishing regulations to protect consumers from monopoly power, for example, it is often tempting to include provisions intended to advance other social goals. The following are among those discussed in the case as elements commonly incorporated into the regulation of cable TV companies:
What are some possible rationales for the other elements? (What motivates them, if not protected from market power?)
To avoid chaos, all sectors of the economy, including businesses must abide by laws. Regulation of businesses by the government has been a subject of controversy for many years. There are those people who feel that businesses should be left to regulate themselves, while others feel that government regulation is vital. Those who argue against government regulation argue that the state is likely to coerce the pricing and production methods of businesses, among others. As a result of government intervention, efficiency and growth of businesses is negatively affected.
Those who urge for government regulation argue that not all businesses act reasonably. Government regulations are designed to enhance control and accountability within specific sectors of business such as accounting. The Sarbanes- Oxley Act protects the public from fraudulent business people by requiring high standards of accountability and control in firms. Government regulations also ensure that consumers do not get a raw deal from frivolous business enterprises. Governments may control the maximum and minimum prices firms can charge for their goods and services so as to not inconvenience a certain class of consumers.
Another major concern for governments, presently, is the issue of sustainability. Governments across the world are required to ensure that they advance sustainable development. This requires them to come up with laws that ensure individuals and businesses do not destroy the environment in the cause of their operations. Sustainable development is a principle anchored on the belief that development should not occur at the expense of the environment. In the U.S, this is done through the Environmental Protection Agency.
Governments regulate firms so as to ensure they comply with the set safety and quality standards. The Food and Drug Administration ensures that the food and drugs that are made available to consumers are fit for human consumption and do not have negative side effects.
The government through intellectual property laws provides an essential service to the business community. Those who are found to have offended copyright, trade marks and patents are punished by the government.
