Posts tagged ‘Capture Theory’

September 12, 2015

What is Capture Theory?

According to the capture theory a government agency that is established to regulate the industry to protect and benefit the society ends up acting for the interests and benefits of the industry instead. In other words the government agency is captured by the industry players. The regulations that are aimed at bringing more transparency and disclosure is helpful according to capture theory as the industry regulator is empowered to notify guidelines and directions to industry players and can take required actions for reinforcing the same and can punish the defaulting members of the industry.

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