ABSTRACT
This chapter presents an analytical model examining the effect of international rivalry between regulators on firm-entry and consequent industry/market profits and product-pricing. The purpose is to yield some insight into whether strategic competition constrains them to pursue the public interest more effectively. There is a substantial body of literature suggesting that regulators are often captured by the industries they control and so end up ignoring the interests of consumers. It is examined here whether regulator rivalry restricts their ability to pursue such a goal and so enhances net welfare. The alternative strategic settings examined are one which tests the effects if one country is regulated, and the other when collusion among international regulators is singled-out the policy-set open to them. This chapter is modeled as a simple three-player game comprising regulators, producers and consumers. This seems to be economically sound given today’s global economic environment (Abdelhamid, forthcoming). I.
