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Wgu Qbt1 Task 5

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[Industrial regulation pertains to the government regulation of firms’ prices or rates within industries. These regulations are in existence to prevent companies from forming a monopoly, to promote competition and achieve allocative efficiency.] (Brue, 2011)
In the mid-1800’s industry began to grow and many companies were becoming monopolies by being dominant firms in their industry. They would drive up prices by using questionable tactics. Different businesses and consumers began to complain to the government about the unfairness of prices The government responded with the Sherman Act of 1890 making both monopoly and conspiracies to restrain trade criminal offenses. While the Sherman Act was for breaking up Monopolies, there was nothing in place to stop companies from using practices that would form a monopoly. Therefore, the government came up with the Clayton Act of 1914 this strengthened the Sherman Act by making it illegal for firms to engage in such practices.
The communication, energy and water where industries were taking advantage of consumers. These three entities each have either have a high barrier to entry or is so unique that competitors stay out, they are therefor considered Natural Monopolies. They are business where the cost of service and or product can create a cost to the consumer that is lowest when created on a large scale typically with a single source supplier. A natural monopoly usually occurs when the first company to bring the service and or product to market that is in such demand and is still so unique that competition cannot easily survive. One example of a natural monopoly is AT&T, The cost of infrastructure (to run wiring to every home) did not allow any other company to enter the market. So AT&T at one point was the only local telephone services provider for the entire United States, until the company was split up by the government.
Another concern that is monitored by government regulation is Oligopoly, where just a few companies control the entire industry. The Airline industry is a good example of an Oligopoly, where the government needed to step and help control pricing and fees.
Industrial or economical regulation, is here to protect the consumer from price gouging on products and or services that customers need from a natural monopoly. Each company is required to play by the same set of rules and must conform to the industrial regulating body that oversees them. These rules affect how much a company can charge for its services, where and how it can market its services even to the point of requiring a company to enter into sharing or privately own resources. The breakup of AT&T fell under these guidelines, they now need to lease the line that is ran to your home that they own to other companies to allow them to enter the market.
[Social regulation is concerned with the conditions under which goods and services are produced, the impact of production on society, and the physical qualities of the goods themselves.] (McConnell B. C., (2011-01-01))
Social regulation is another aspect of Industrial regulation this catigory includes pollution, product safety, worker safety, and discrimination. The regulatory agencies include The Equal Employment Opportunity Commission (EEOC), Environmental Protection Agency (EPA), National Highway Traffic Safety Administration (NTSA), Occupational Safety and Health Administration (OSHA), and Consumer Product Safety Commission, to deal with social problems.

(McConnell B. C., (2011-01-01))
Food and Drug Administration (FDA)[ is responsible for protecting the public health by assuring the safety, efficacy and security of human and veterinary drugs, biological products, medical devices, our nation’s food supply, cosmetics, and products that emit radiation.] ( By regulating theses the government is ensuring the public’s health and safety.
Equal Employment Opportunity Commission (EEOC)[is responsible for enforcing federal laws that make it illegal to discriminate against a job applicant or an employee because of the person's race, color, religion, sex (including pregnancy), national origin, age (40 or older), disability or genetic information. It is also illegal to discriminate against a person because the person complained about discrimination, filed a charge of discrimination, or participated in an employment discrimination investigation or lawsuit.] ( By enforcing these laws the public is protected from discrimination in the work place.
Occupational Safety and Health Administration (OSHA) is here [to assure safe and healthful working conditions for working men and women by setting and enforcing standards and by providing training, outreach, education and assistance.] ( By using theses OSHA can ensure the health and safety of employees.
Environmental Protection Agency (EPA) is [designed to promote public health by protecting our Nation's air, water, and soil from harmful pollution. EPA accomplishes its mission by a variety of research, monitoring, standard setting, and enforcement activities. EPA also coordinates and supports research and antipollution activities of State and local and tribal governments, private and public groups, individuals, and educational institutions. EPA also monitors the operations of other Federal agencies for their impact on the environment.] (
The four parts of antitrust legislation are the Sherman Act, the Clayton Act, the Federal Trade Commission/the Wheeler-Lea Act, and the Celler-Kefauver Act.
The Sherman Act is the Federal antitrust law of 1890 that makes monopoly and conspiracies to restrain trade criminal offenses. (McConnell B. C., (2011-01-01)) This act has two sections, section one that states “Every contract, combination in the form of a trust or otherwise, or conspiracy, in restraint of trade or commerce among the several States, or with foreign nations is declared to be illegal.” (McConnell B. C., (2011-01-01)) Section two states “Every person who shall monopolize, or attempt to monopolize, or combine or conspire with any person or persons, to monopolize any part of the trade or commerce among the several states, or with foreign nations, shall be deemed guilty of a felony” (as later amended from “misdemeanor”). (McConnell B. C., (2011-01-01)).
The Clayton Act is the Federal antitrust law of 1914 that strengthened the Sherman Act by making it illegal for firms to engage in certain specified practices. (McConnell B. C., (2011-01-01))
There are four sections to this act that both straighten and make the Sherman Act more clear, they are sections 2, 3,7, and 8.
Section 2- outlaws price discrimination when such discrimination is not justified on the basis of cost differences and when it reduces competition.
Section 3- prohibits tying contracts, in which a producer requires that a buyer purchase another (or others) of its products as a condition for obtaining a desired product.
Section 7- prohibits the acquisition of stocks of competing corporations when the outcome would be less competition.
Section 8- prohibits the formation of interlocking directorates—situations where a director of one firm is also a board member of a competing firm—in large corporations where the effect would be reduced competition.

The Federal Trade Commission/the Wheeler-Lea Act the Federal Trade Commission Act of 1914 allowed the (FTC) investigate to unfair competitive practices of firms, to hold hearings on the complaints of such practices, and to issue cease-and-desist orders when firms are found to engage in such practices. (McConnell B. C., (2011-01-01)) . While the Wheeler-Lea Act is a Federal law of 1938 that amended the Federal Trade Commission Act by prohibiting and giving the commission power to investigate unfair and deceptive acts or practices of commerce (such as false and misleading advertising and the misrepresentation of products). (McConnell B. C., (2011-01-01)).
[The Celler-Kefauver Act amended the Clayton Act, Section 7, which prohibits a firm from merging with a competing firm (and thereby lessening competition) by acquiring its stock. Firms could evade Section 7, however, by instead acquiring the physical assets (plant and equipment) of competing firms. The Celler-Kefauver Act closed that loophole by prohibiting one firm from obtaining the physical assets of another firm when the effect would be reduced competition. Section 7 of the Clayton Act now prohibits anticompetitive mergers no matter how they are undertaken..] (McConnell B. C., (2011-01-01))

Three main regulatory agencies oversee the industrial regulation in the United States. Numerous smaller agencies are called upon to specialize in specific areas while these larger ones have broad scope. The main three agencies are the Federal Trade Commission, The Securities and Exchange commission and The Federal Communication Commission.
The FTC is the agency that regulates companies and their compliance with federal law. This agency has final say in how companies operate, overseeing of monopolies in industries and general consumer protections with the backing of the federal government.
The Security and Exchange Commission(SEC) is responsible for the financial observance and fair practices of companies working in the United States (or those that do business here).
The Federal Communications Commission (FCC) is the regulatory commission responsible for the wireless and wire communications in the United States. It is a creation by Congress as an Industrial regulatory agency in the aftermath from the AT&T/ Bell monopoly splits. The FCC works towards six primary goals in the areas of broadband, competition, the spectrum, the media, public safety and homeland security.
The Communications Act of 1934 and as amended by the Telecommunications Act of 1996 (amendment to 47 U.S.C. §151) state that it is the FCC's mission to "make available so far as possible, to all the people of the United States, without discrimination on the basis of race, color, religion, national origin, or sex, rapid, efficient, Nation-wide, and world-wide wire and radio communication services with adequate facilities at reasonable charges."[sic] The Act furthermore provides that the FCC was created "for the purpose of the national defense" and "for the purpose of promoting safety of life and property through the use of wire and radio communications. (
It is still a process to determine if the regulations to industry, social and Anti-Trust are a positive or negative force in the lives of consumers. The past several years we have seen a dynamic shift towards “De-regulation” from consumers and businesses alike.
Works Cited
FCC. (n.d.). Retrieved from
FERC. (n.d.). Retrieved from /
McConnell, B. C. (n.d.).
McConnell, B. C. ((2011-01-01)). Economics [19]. Retrieved from
NARUC. (n.d.). Retrieved from

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