Group items tagged

When a market is not competitive, there is a need for regulators. Their role is to balance the interests of various stakeholders. Business organizations can use a monopoly position to create extremely high added value for the benefit of their shareholders, employees etc. Customers need to be protected by limiting these monopoly powers. At the same time, it is necessary for the businesses to price their products at a sufficient margin. Regulatory bodies are established in countries according to the policy of the government with different types of authorities. Regulatory rules are designed to meet government objectives. Those rules should be understood by the regulator and the regulated industry. Objectives of regulatory authorities can be classified under the following: * To protect customers from monopoly power * To promote social and macroeconomic objectives * To promote competition When the players in regulated market have significant market power, the regulator has to focus on price or tariff controls or control on quality of service. Certain social objectives such as availability and affordability of services to particular groups like disabled or people in rural areas, cannot be achieved from macroeconomic objectives of the government. Therefore regulatory bodies are established to control and monitor these areas. Actions can be taken by regulatory authorities to assist the development of market segments where there is scope for competition.

When a market is not competitive, there is a need for regulators. Their role is to balance the interests of various stakeholders. Business organizations can use a monopoly position to create extremely high added value for the benefit of their shareholders, employees etc. Customers need to be protected by limiting these monopoly powers. At the same time, it is necessary for the businesses to price their products at a sufficient margin. Regulatory bodies are established in countries according to the policy of the government with different types of authorities. Regulatory rules are designed to meet government objectives. Those rules should be understood by the regulator and the regulated industry. Objectives of regulatory authorities can be classified under the following: * To protect customers from monopoly power * To promote social and macroeconomic objectives * To promote competition When the players in regulated market have significant market power, the regulator has to focus on price or tariff controls or control on quality of service. Certain social objectives such as availability and affordability of services to particular groups like disabled or people in rural areas, cannot be achieved from macroeconomic objectives of the government. Therefore regulatory bodies are established to control and monitor these areas.