The social interest theory of regulation predicts that the political process will seek to minimise
A) producer surplus.
B) total surplus.
C) consumer surplus.
D) deadweight loss.

Question

Quizplus · Accepted Answer

The social interest theory of regulation suggests that regulation is supplied in response to the public's demand for the correction of inefficient or inequitable market practices. It predicts that the political process will seek to minimize deadweight loss, which is the loss of economic efficiency that can occur when the equilibrium for a good or a service is not achieved or is not achievable.

The Social Interest Theory of Regulation Predicts That the Political