Why regulating economic, political and business areas is unnecessary?Answer:IntroductionThe development and technique of regulation has long been the subject of academic research for many scholars. Many researchers doing undergraduate and masters have showed a lot of interest in this particular area. Two schools of thoughts have emerged on regulation policy that is the positive side of regulation and the negative side of regulation (Baldwin, 2009). We cannot dispute the fact that everything has its pros and corns and so do regulation and deregulation but what counts is what has more benefits than the other. Regulation may be seen important especially to the public since regulation will safeguard the welfare of the public especially in the communist world. For example a regulation on alcohol will have more benefits to the public although it will have an adverse effect to the alcohol industries and manufactures. In my view it is a waste of time and is not necessary.ThesisRegulation of economic, political and business fields do more harm than good to the economy of any nation and its people.Definition of regulationRegulation is the process of government passing laws to control certain activities and often business activities to protect the public from what is viewed unethical, dangerous, or any undertaking threatening the security of the public. It is within the states powers and mandate to prohibit or compel to give or to take money from industries and the state can or does selectively hurt a vast number of industries. Regulation may be actively sought by an industry or thrust upon it, the regulation is acquired by the industry and designed and operated to benefit the industry (George, 1971).Over regulation.The political, economic and business regulation is widely acknowledged as important to protect the social environmental values. This is mostly seen in the communist countries which put the interest of people and the welfare of its citizens before anything else. This results to government enforcing strict rules and regulation governing the industries. Many economists like Milton Friedman have opposed this and advocated for minimal regulation (Milton, 2002). He argues that government should limit its involvement since the government instead of using its mandate of regulation to benefit the public they use it to correct the market failure created by their incompetent and inefficient for its own political agenda. I believe that government through this intervention creates more problem than solutions this is because some government officers due to their incompetent are incapable of correcting and coming up with accurate economic measures that will reasonably guide the free market without necessary bringing in unnecessary regulations that slows development and have adverse effect to the economy. For example if the government fails to control the rising or the falling of it?s currency it lays blames on the financial institutions like banks and put in place harsh measures to regulate borrowing. This may have been solved better by the government coming up with policies that will open avenues for new foreign investments.Big bureaucracy in regulation.I highly support free market because I believe that if you remove government restrictions, the free market will force businesses to protect consumers, provide superior goods and services and create affordable prices. Without any government control the businesses are in a better position to improve their products and services freely and compete fairly in the market which will consequently make the products and services affordable to the common citizen. This occurs especially in import and exports. Many nations globally tend to complicate their international business process to a point where it becomes almost impossible to do business internationally (Susan, 2010 ). But if this bureaucracy is minimized or is completely done away with then many companies will be in a better position to compete with their counterparts in the same industry both locally and globally. This will be to the benefit of the consumers who are citizens that the government is mandated to safeguard their welfare. But if the government intervenes and regulates the market with its inefficiencies it will only create nothing but a big bureaucracy that will increase the cost of doing business for everyone. The burden of this increase in cost of doing business is passed on to the consumers through increase in prices of goods and services making them unaffordable to the common people in the country.Regulation promotes monopoly.Monopoly is seen to exist as a result of lack of government intervention but on the contrary monopolies have historically existed due to government intervention. Monopoly doesn?t merely mean a sole supplier of a particular kind of good or services but it is a situation where there is no opportunity to compete freely in the market on the basis of price competition, technology or product innovation, marketing strategy applied without any intervention. A monopoly industry is secured of any competition and therefore it is able to make pricing and production decisions with an assurance that there is no competition that will arise. This directly has an adverse effect to the consumers who are the final users of the product because they will take any prices set for the monopolized goods. But this only happens with the government intervention and restricting competition which is the only direct and sure way that the business will close entry into a certain industry or sector and be able to raise prices free of competitive force. But without government regulations the firms must keep their prices low otherwise if they raise their price they will attract more firms to the market to compete by offering relatively low prices. For example the electricity sector maintains its monopoly due to government intervention and therefore the consumer have no other alternative but to pay any prices set by this monopoly.Regulation hinders innovation.Without regulation where there market is allowed to run freely the consumer voices are heard in that their decisions determines what products and services are in demand and the prices of these goods and services. Customers are dynamic and time to time requires customized products that will suit their needs, for example a change in the fashions of cloths. Almost every month there is a new fashion design for cloths especially for girls this is due to increase in competition in these clothing and textile industry.Wages regulation creates unnecessary unemploymentAnother area of intervention that I feel that it not necessary is the regulation of wages by the government. The government in this case regulates the minimum wages paid to a laborer. It may appear very helpful to the workers but if analyzed critically it creates unnecessary unemployment to people. If for example the minimal wage bill is passed not to pay any worker below x per hour or per day then the employer will be forced to maintain in their payroll list only those whose daily or hourly work brings in more than x revenue and therefore any employee who is less productive or doesn?t meet this minimum revenue requirement per day will at the end of the day lose his/her job.Price regulation leads to shortages and product crises.In order to appear protective and concerned the government through its political agenda will pass and implement a bill that controls the prices of the products and services offered for example ?price ceiling? which means setting the highest prices that can be charged for a particular commodity (John, 2000). By setting this price ceiling what they don?t know is that by keeping these prices artificially low demand goes up to a point where supply cannot keep up leading to shortages of the regulated commodities. Many oil crises in many countries are evident of the effect of price regulation by the government.ConclusionFree market economies aren?t perfect but the completely regulated economy is imperfect by far. In relation to what have been Discuss (check midcourse.net for the help you need)ed above it is clear that if free market is adopted it will be more beneficial to the public. It is always thought that the individual firm lacks the perspective or the incentives to protect the society and that?s why government comes in with its primary intent of protection and of the enhancement of business competition. In general regulation is seen to protect the minorities, investors, employees and the environment. But in actual sense if analyzed critically it is seen that regulation does more harm to the said protected groups than good. Although indirectly it doesn?t mean it affects them any less for example as quoted earlier if the government set price ceiling it results to shortage which is an adverse effect felt by the protect group.ReferencesBaldwin, R. M, (1999) Care understanding regulation: theory and Practice, New York: Oxford University press Davis, P (2010). ?Summary of the Dodd?Frank Wall Street Reform and Consumer Protection Act, Enacted into Law on July 21, 2010,? Polk & Wardwell, LLP, July 21, 2010.George J. S, (1971) The theory of economic regulation: The University of Chicago the bell journal of economics and management science vol2 no.1 ( Spring, 1971) pp 3-21.John. B, at el (2000). Global Business Regulation. Cambridge University Press.Milton, F. (2002), capitalism and freedom: university of Chicago press.Susan, D. (2010). ?An Ambitious Regulatory Agenda,? GeorgenWashington University Regulatory Center, Regulatory Policy Commentary, December 24, 2010, at http://www.regulatorystudies.gwu.edu/images/commentary/20101224_dudley_regulatory_agenda.pdfPress order button for similar paper now???.Category: Best Essay Writing Services-UK
Unlike most other websites we deliver what we promise;
- Our Support Staff are online 24/7
- Our Writers are available 24/7
- Most Urgent order is delivered with 6 Hrs
- 100% Original Assignment Plagiarism report can be sent to you upon request.
GET 15 % DISCOUNT TODAY use the discount code PAPER15 at the order form.