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Question
The Interstate Commerce Commission (ICC) regulates railroads, barges and trucks. Suppose technical change lowers the costs of railroads. As a result, the ICC permits railroads to lower prices some but also alters the rates of barges and trucks so they get additional business. The ICC would be acting consistently with
A) the capture theory of regulation.
B) the public interest theory of regulation.
C) the share-the-gains, share-the-pains theory of regulation.
D) None of the theories presented in the text since economic regulation is specific to a single industry and not to agencies that cover more than one industry. That is the province of social regulation.
Answer
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