Regulation

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    Regulation

    • Regulation involves rules administered by a government agency or another body.
    • These rules are designed to influence barriers to entry and exit, prices charged, product standards and how the product is sold.
      • These regulations, especially in the case where they’re administered by the government, are backed up by law
      • They are designed to correct market failure from the abuse of market failure, imperfect information, under-consumption of merit goods, and other causes.
    • For Cinema:
      • The British board of film classification is seeking to overcome information failure by classifying movies with age ratings (18, 15, PG, U, etc.)
      • In the past, however, it used to censor films, treating the censored parts as demerit goods.
    • For TV Broadcasting:
      • Ofcom furthers the interests of consumers by promoting competition and protecting them from harmful or offensive material (demerit goods)
    • For Tourism:
      • The trade organisation ABTA (Association of British Travel Agents) aims to maximise the consumer’s satisfaction by issuing a range of guidelines covering advertising and the sale of services
      • If a firm doesn’t adhere to these guidelines, then they can be fined or expelled from ABTA
      • A consumer can therefore be confident in a firm that is a member of ABTA
    • For spectator sports:
      • UK athletics oversees drugs-testing of athletes, to ensure fair competition, and implementing the rules of the sport
      • Cricked is governed by The England and Wales Cricket Board (ECB), which is responsible for the direction of cricket in the country
      • The FA is responsible for upholding and administering the rules of football, and has the power to change the rules.
    • Some sports are governed by international bodies, such as FIFA being responsible for the organisation of international football tournaments
    • The Royal and Ancient Gold Club of Saint Andrews is also tasked with developing and promoting the game of golf to other nations
    • The Office of Fair Trading, which has a jurisdiction over the leisure industry, enforces consumer protection and competition law, and seeks to maximise competition
      • If the OFT is concerned by any behaviour, or anti-competitive practise, it can ask the competition commission to carry out an investigation, which could result in large fines.

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