Tighter Grip on the Economy Needed

Essay from the year 2010 in the subject Economics - Macro-economics, general, grade: 67, De Montfort University Leicester, course: Contemporary Business Issue, language: English, abstract: The purpose of this paper is to consider the rationale of economic regulation, why regulation has

welfare benefits and why consumers of financial services, particularly retail consumers demand

regulation of the economy.

A poll carried out by the BBC showed that most people want their government to have more control

over the running of their economy. However, some academic liberals (Bentson, 1998) are skeptical

of the benefits of such regulation. These critics of economic regulation argues variously as follows;

that there is no market failures and imperfections, and that if they do exist they are not sufficiently

serious to warrant regulation, and that regulation may not practically solve these failures and

imperfections, and that if it does, it can only do so by imposing cost that might exceed the cost of

the original problem, and that imposing regulation raises serious moral hazards, and finally, that

regulation imposes a wide range of cost which is ultimately borne by consumers.