Definitely it very imperative to
give a conceptual meaning of deregulation before delve into the policy that
prompt the Federal government to look into the petroleum downstream sector.
Deregulation: Deregulation
is when government reduces its role and allows industries greater freedom in
how it departs.
It
is therefore not the opposite of regulation, which refers to the governmental
administration of market constraints developed by written law and judicial
decisions.
As a result of
the deregulation, France telecom
operates phone booths in Wellington, New Zealand.
The state rationale for deregulation is often
that fewer and simpler regulations will lead to a
raised level of competitiveness, therefore higher productivity more
efficiency and lower prices overall.
Opposition usually involves apprehension
regarding environmental pollution,
quality standards ( such as the removal of regulations on hazardous materials) financial uncertainty, and construing monopolies.
A parallel development with deregulation has been organized, ongoing
programmes to review regulatory initiatives
with a view to minimizing, simplifying and making more cost effective
regulation, such effort, given impetus
by regulatory flexibility act of
1980, are embodied in the Unites States office of management and
budgets office of information and regulatory affairs the untied kingdoms better regulation
commission, cost benefit analysis is frequently used in such reviews
In addition
there have been regulatory
innovations usually suggested by
economist, such commissions trading.
One can distinguish between deregulation and
privatization where privatization can be
seen as taking state owned
service providers into the private sector.