Regulatory Competition

Regulatory competition refers to the situation where different jurisdictions—like countries or states—compete to attract businesses by offering favorable laws and regulations. In the context of competition policy, this can involve lowering standards or providing incentives to encourage companies to operate there. While this can benefit consumers through lower prices and more choices, it may also lead to harmful practices if regulations are weakened too much. Essentially, it’s a balance between maintaining fair competition and ensuring that regulations protect public interests, such as health, safety, and environmental standards.