The equilibrium level of regulation is where the marginal political benefits to the special interests are equal to the marginal political costs of the foregone regulation.

Question

Quizplus · Accepted Answer

This statement accurately describes the concept of regulatory equilibrium in which the level of regulation is determined by a balance between the benefits and costs of regulation to various interest groups involved in the political process. At the point where the marginal political benefits to special interests are equal to the marginal political costs of foregone regulation, there is no incentive for any group to push for further regulation or deregulation.

The Equilibrium Level of Regulation Is Where the Marginal Political