Industrial regulations are those regulations in which “the government commissions regulate the price charged by natural monopolists”. (McConnell & Brue, 2008, p. 382) These regulations exist to ensure that natural monopolies are not charging consumers monopoly prices which in turn hurt the consumers as well as society as a whole. Industrial regulations affect the market by its regulation of the natural monopolies which in turn protects the markets consumers. These regulations also allow for a fair profit to the natural monopoly by setting a fair rate, protecting its consumers, but also a “fair return to the enterprises”. (McConnell & Brue, 2008, p. 382)
In terms of market structure, entities that are affected by industrial regulations include monopolies which do not allow for new entrants into the market making them the only option for consumers. With so much control industrial regulations are necessary and can affect these entities. These economic regulations are there to promote competition by taking the control of a particular market away from the monopoly by regulating prices that can resort to using abusive tactics to maintain the control.
Social regulations are those regulations that deal with the “conditions under which goods and services are produced, the impact of production on society, and the physical quality of the goods themselves”. (McConnell & Brue, 2008, p. 384) These particular regulations exist due to emphasis finally being placed on quality and better working conditions; not just the rate at which the products are sold or the profit due to the industry as is the case with industrial regulations. There is a great deal more entities affected by social regulations then by industrial regulations as these regulations affect all industries. These regulations affect entities such as employers through the different regulatory commissions that create social regulations. For an employer these regulations can be anything from the safety...
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