Economics Regulation and Market Structures Essay

Economics Regulation and Market Structures - Essay ExampleEconomic regulation affects new companies who exigency to enter into a market. This reason why new competitors are affected is that they whitethorn not be able to enter into a market callable to this form of regulation. Social regulation deals with exact social problems such as toxic waste, produce safety, employee safety, and prejudice (Social Regulation). Social regulation exists because in the 60s and 70s the government established regulatory agencies to handle a wide variety of social problems. The entities affected by social regulation include local businesses and citizens. Businesses may have to have a plan to deal with social problems, while citizens may have their rights restricted in terms of what they give the sack purchase. A instinctive monopoly occurs when a firm can fulfil the market demand for a good or service at a cheaper price than all otherwise competitors (Natural Monopoly). The reason why natural mono polies occur is because sometimes a market can only support one producer. According to economic theory, firms can attain monopolies because of unique raw materials, technology, or other factors. An example of a natural monopoly is the gas industry. It is uneconomical to build new infrastructure so solely one set of infrastructure is built. This results in company having total control of the market (Pieterz). The antitrust laws attempt to order business to compete fairly.