The inclination of regulatory agencies to find market solutions that are economically efficient is explained by the:
A) theory of imperfect competition.
B) public interest theory of regulation.
C) capture theory of regulation.
D) public choice theory of regulation.

Question

Quizplus · Accepted Answer

The public interest theory of regulation suggests that regulatory agencies aim to promote the overall welfare of society by finding market solutions that are economically efficient. This explains their inclination towards economic efficiency. The other theories, such as capture theory and public choice theory, do not necessarily explain this particular inclination.

The Inclination of Regulatory Agencies to Find Market Solutions That