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Just the Fracts Discussion

Top 5 Reasons Fracking Regulations Are Whack

Competition is the only force that has consistently both lowered consumer prices, while also improving the quality of the good or service for sale. By increasing the cost of compliance, command-and-control regulations create a barrier of entry to newcomers into the hydraulic fracturing industry, which protects the current drilling companies allowing them to increase their prices without any pressure to innovate.  Name some other industries where we’ve witnessed regulations limiting entry into the industry and whether competitors have been successful in breaking through the barriers (if so, how did they accomplish that)?


One other example of government regulation which limits entry on the supply side is taxi licensure in NYC. The licence system limits the number of taxis allowed to operate in the city to a specific quota, and these licenses are prohibitively expensive for all but a few taxi companies. Uber is the perfect example of private actors breaking through the licensure barrier by creating a non-licensed market that could compete with taxis.