Deregulation

Deregulation

The reduction of government's role in controlling markets, which lead to freer markets, and presumably a more efficient marketplace.

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Deregulate

To reduce the amount of regulation over a market or economy. It may include reduced or eliminated requirements for reporting or filing statements with regulators. Deregulating may allow an organization to conduct more activities than it could before; for example, it may allow a bank to make more high risk investments. Deregulation is intended to increase efficiency in the market by letting the Invisible Hand guide the economy apart from government intervention. Opponents, however, argue that deregulation increases the likelihood of fraud and unfair practices such as insider trading. Many analysts agree that deregulation helps firms on solid financial footing and hurts those that are not.

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deregulation

The act of removing controls from some sector of the economy. In nearly all cases, deregulation of a given industry has both positive and negative implications for investors. Typically, firms in a strong financial position benefit from deregulation, while firms in a weak financial position suffer.