DEREGULATION

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• The process of removing or reducing state regulations

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• It is therefore opposite of regulation, which refers to the process of the government regulating certain activities

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• One problem that encouraged deregulation was the way in which the regulated industries often controlled the government regulatory agencies, using them to serve the industries' interests.

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• The transportation industry is one of the most famous industries to feel the effects of deregulation. In 1887, Congress established the Interstate Commerce Commission (ICC), which regulated the railroad industry.

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• Like most economic policy, deregulation is controversial. Most economists agree that deregulation lowers an industry's barriers to entry and generally increases efficiency, competition, entrepreneurship, and innovation.

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• Deregulation also benefits the broader economy because it no longer requires taxpayers to support the regulatory agency's overhead.