Government Regulation - Research Paper Example

Government regulation Introduction Regulation refers to legal frameworks put in place to restrict, control and or prevent certain effects, which mayinclude but not limited to behaviour, action, authority and right. governments especially the legislative and the executive branches of the government have been highly instrumental in implementing rules that restricts operations and rights all over the country. Government regulation refers to a deliberate attempt by the government to put in place legal barriers to restrict and control certain undertakings by individuals as well as corporate bodies in the society. Regulation of a country’s affairs by the government is not a contemporary issue as it is considered an event that began several decades ago as most governments engaged in attempts to advance their interest. In other words, regulations have been used to protect key interests of the civilians and those of the government of the day. Government regulations touch on a number of issues key among them being political, economic and social. Operating regulation As time passes by regulations, tend to develop at numerous government levels as commissions gain greater powers with respect to operation of regulations. In other words, the government departments and agencies are becoming heavily involved in design and final implementation of the regulations. It is noteworthy that government agencies constituted by either the executive or the legislative branches are highly responsible for actual implementation of various regulations issued by the government department in charge. For instance, in the United States, the Food and Drug Association (FDA) and Environment Protection Agency (EPA) are responsible promoting laws that ensure safe food and drug products are in the market while as well as laws that cut down on pollution effect in the country respectively. Government agencies have become powerful institutions over the recent past owing to the delegate roles they have been extended to by the government. For instance, the legislative arm of the government may formulate or enact laws and establish guiding principles and the agencies are left to make follow-ups and final implementation. The operations of these agencies are highly influenced by their independence and as such, there are certain agencies that free from the control of the executive and other department of the government. The government departments as well as agencies do not often work in isolation considering the fact that members from the private sector are normally included in the board. The private sector plays a significant role in ensuring that there is no conflict between the regulators and the affected parties. The private sector assists with advising the government on pertinent business issues that if not taken into consideration may lead to expensive court battles inform of protest against the regulation. Types of regulation There are two renowned types of regulations identified by economists and they include economic and social regulation. Economic regulation is, concerned with price controls and entry controls. Various governments across the world are renowned for instituting rules and standards that aim at limiting individuals and corporate that enters into a business as well as the prices that business can charge for their products and or services. For instance, a sole proprietor is required to acquire a trade licence in order to start operation. This a clear example of an entry limit through economic regulation. In instances of price limit organizations in a particular industry may be forced by rules to charge or not exceed particular prices. For instance, the government may stipulate a price quota for local airlines with respect to air tickets to control unfavourable competition. Another form of control may be witnessed in terms of the final consumers. For instance, a government may restrict who the final consumers of the goods and or services should be. Antitrust law is another form of economic regulation. This law tries to promote fairness and favourable completion by eliminating uncalled for competition. For instance, aggrieved parties can use antitrust law to stop companies that want to merge or collaborate to form a monopoly and thus unfair competition. Social regulation refers to the rules and standards that governs the terms and conditions of operating a business. In other words, Social regulation is often considered when commercial interest is likely to interfere with the stipulated ethical codes of operations and welfare of the public. Organizations are often allowed to compete and operate independently in a free market economy. However there are concern that despite the fact that a free market may encourage maximization of efficiencies and effective utilization of limited resources it may make companies overlook important issues in the economy such as minimum wage, pollution effect, and or working condition. This means that one of the main objects of social regulation is to correct market failures. The public sector is often caught up in a conflict between the interest of the companies, third parties and consumers. The main objective of corporate bodies, which involves profit maximization, is likely to interfere with the public as well as employees’ welfare. Social regulation is based on the principle that if corporate bodies are not controlled then they are likely to heart the interest of third parties and those directly involved with the operations of the companies. Governments therefore have forms of regulations that ensure that organizations stick to certain behaviours. Setting up the standards and code of behaviour is aimed at eliminating possibility of conflict between commercial organizations, third parties and those directly involved by the operations of the organization. The government uses regulations to control private organization attain social goals, which may include but not limited to maintaining clean and healthy environment as well as promoting safety. A clear example of social regulation involves the control exercised by the US Food and Drug Administration over the safety of food and drugs. Elements of regulation It is significant to highlight various elements of regulation as this is important in ensuring that a clear distinction between government regulation, management and prohibition. Government regulations revolve around setting up and enforcing standards of conduct for different players in the society to promote legitimate activities. Government management on the other hand involves administration of public property. For instance, the government may regulate alcohol manufacturing but manages highways/airports. Government prohibition is an issue of criminal law, which categorizes certain actions (murder, rape, fraud) by individuals as inherently evil. These actions are not regulated but instead prohibited unlike in the case of broadcast content, which is regulated. For instance, censorship of pornography is a government regulation but not a prohibition. Notable elements of regulation that distinguish it from management and prohibition by the government include but not limited to inspection, statutes, licensing and relicensing, registration, standards . All these elements are contained in regulations under different capacities to limit and or control illegitimate activities. It is noteworthy that the government utilises these elements in both economic and social regulations. For instance, the government uses permits, registration and or licenses to acknowledge the fact that a business enterprise has complied with all the requirement necessary to operate the type of business in question. Inspection is another element of government regulation that seek to ensure that business operations are compliant with the requirements of law and as well as the stipulated standards of operation. It is noteworthy that inspection is often carried out periodically unlike registration or license, which is issued once. Statutes are laws enacted by the legislative assembly to govern affairs of the country. Some of these statutes have been enacted specifically to control or limit specific operations of business enterprises, promote social goals and stipulate acceptable code of conduct for businesses. Read More