The Capture Theory of Regulation Contends That

question 156

Multiple Choice

The capture theory of regulation contends that

• A)the public "captures" the benefits of regulation through lower prices.
• B)natural monopolies "capture" high profits through the reduction of output.
• C)the regulatory agency is eventually "captured" by the special interests of the industry being regulated.
• D)large corporations "capture" high profits by regulating the tastes and preferences of the buying public.

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Definitions:

Moral Standards

Rules or principles governing what is considered right or wrong behavior.

Superego

In Sigmund Freud’s theory, the internalization of the moral standards of society inculcated by the child’s parents.

Reality Principles

The ability of the mind to assess the external world and act upon it rather than based on internal desires.

Internalization

The psychological process by which individuals integrate beliefs, values, standards, or norms into their own value system, making them their own.