what is deregulation

Deregulation is the process of removing or reducing state regulations, typically in the economic sphere. It is the repeal of governmental regulation of the economy, usually enacted to create more competition within the industry. Deregulation can take different forms, such as reducing the stringency or the scope of federal rules, maintaining the same level of regulatory scope and stringency while making the rules more efficient and streamlined, or removing or reducing government regulations in a specific industry. The goals of deregulation are to allow industries to operate businesses more freely, make decisions efficiently, and remove corporate restrictions. The main objective is to remove barriers to competition so that a particular industry can compete in the international market more easily. The hoped-for effects of deregulation are to increase investment opportunities by eliminating restrictions for new businesses to enter markets and increase competition. Increasing competition encourages innovation, and as companies enter markets and compete with each other, consumers can enjoy lower prices. Lessening the need to use resources and capital to comply with regulations allows corporations to invest in research and development. However, opposing perspectives have been in play in national and international discourse, and deregulation has engendered substantial controversy.