Access for free at openstax.org
11.4 • The Great Deregulation Experiment 271

not have an easy task.

11.4 The Great Deregulation Experiment

LEARNING OBJECTIVES

By the end of this section, you will be able to:

• Evaluate the effectiveness of price regulation and antitrust policy

• Explain regulatory capture and its significance

Governments at all levels across the United States have regulated prices in a wide range of industries. In some

cases, like water and electricity that have natural monopoly characteristics, there is some room in economic

theory for such regulation. However, once politicians are given a basis to intervene in markets and to choose

prices and quantities, it is hard to know where to stop.

Doubts about Regulation of Prices and Quantities

Beginning in the 1970s, it became clear to policymakers of all political leanings that the existing price

regulation was not working well. The United States carried out a great policy experiment—the deregulation
{"file_name": "Microeconomics3e.pdf", "file_type": ".pdf", "total_pages": 597, "creator": "PDFMiner", "title": "Principles of Microeconomics 3e", "creationdate": "2022-12-07T14:15:44-06:00", "uploaded_via": "batch_uploader", "source_file": "downloads\\business\\economics\\Microeconomics3e.pdf", "moddate": "2022-12-07T14:23:05-06:00", "source": "downloads\\business\\economics\\Microeconomics3e.pdf", "producer": "Prince 14.2 (www.princexml.com)", "file_hash": "830b81f41611ac67a490444dbb5d6aed292224606965b06965b914443c93331a", "file_size_mb": 26.99, "batch_upload": true, "upload_timestamp": "2026-02-07T15:24:38.309401"}