Role of Government

Antitrust LegislationTrusts- legally formed combinations of corporations

The Sherman AntiTrustFirst significant law against monopoliesSet broad foundations for maintaining competition

The Clayton Anti Trust ActGave the government greater power against monopoliesThe act outlawed price discrimination- charging different prices for different people.

Robinson-Patman ActStrengthened the Clayton Act

Federal Regulatory Agencies

The Federal Trade Commission ActGave the government the power of cease and desist orders.

Cease and desist Order- an FTC ruling requiring a company to stop an unfair business practice, such as price fixing

FDAFood and Drug Administration- enforces purity, labeling, and effectiveness of foods, drugs, and cosmetics

FTCFederal Trade Commission- enforces antitrust laws, price fixing, unfair competition

FCCFederal Communications Commission – regulates radio, television, telephone and telegraph rates and services

SECSecurities and Exchange Commission- regulates and supervises the sale of securities (stocks)

NLRBNational Labor Relations Board- supervises federal labor relation laws

FAAFederal Aviation Administration- supervises the airline industry

EEOCEqual Employment Opportunity Commission- investigates charges of discrimination by employers and unions

EPAEnvironmental Protection Agency- protects the environment

OSHAOccupational Safety and Health Administration- investigates accidents at the workplace, enforces safety laws

CPSCConsumer Product Safety Commission- developed standards of safety for consumer goods.

NRCNuclear Regulatory Commission- regulates the use of civilian use of nuclear materials

FERCFederal Energy Regulatory Commission- supervises the energy industry

Internalizing Externalities Government uses the tax system to lessen

negative externalities in the economy.

Example- Government taxes polluters, gives tax relief to companies that clean the environment.

Public DisclosuresGovernment forces companies to reveal information to the public

Indirect Disclosures Government works indirectly to improve the quality of information