ABSTRACT
Regulation of the US economy has become an important and controversial aspect of federal governmental activity. More and more administrative agencies have the power to regulate prices, entry of firms into an industry, and levels of production. Studies of regulation generally fall into three categories: 1, price and entry regulation of industries with competitive markets, 2, price and entry regulation of naturally monopolistic industries, and 3, regulation which deals with market failure in areas such as environment, health, occupational safety, and product quality. This chapter focuses primarily on the first category, industry regulation of competitive markets. In broad field of competitive market regulation, two well known approaches have dominated the literature in recent years: the "capture" theory approach and the theory of "congressional dominance". These two approaches to the study of regulation comprise a literature which develops the strategies and goals of the actors in the regulatory process.
