The capture theory of regulation, espoused by George Stigler, asserts that
A)consumers "capture" regulatory agencies so that regulation favors consumers
B)producers "capture" regulatory agencies so that regulation favors producers
C)regulators "capture" producers and limit their market power
D)consumers "capture" some consumer surplus lost to monopoly
E)consumers and producers work together to "capture" regulatory agencies in order to achieve more desirable regulation

Question

Quizplus · Accepted Answer

The capture theory of regulation, espoused by George Stigler, asserts that producers "capture" regulatory agencies so that regulation favors producers. Producers use their resources to influence regulations in their favor, leading to regulatory capture. This allows producers to gain market power, exploit consumers, and limit competition.

The Capture Theory of Regulation, Espoused by George Stigler, Asserts