Question

Agency capture occurs when

a. a regulatory agency funnels money back into the lobbying organizations that are seeking policy changes.
b. regulatory agencies side with the industries they are supposed to regulate rather than with the public.
c. the executive branch takes back control of a regulatory agency by passing regulation to prevent undue influence by lobbying organizations.
d. a regulatory agency must be dismantled because it has become corrupted.
e. an election results in the replacement of an agency's leadership through appointive positions under a new president.

Answer 1

Agency capture occurs when regulatory agencies side with industries they regulate instead of the public, often influenced by lobbying and offers of employment. Option b. is correct.

Step-by-step explanation:

Agency capture refers to a situation where regulatory agencies side with the industries they are supposed to regulate, rather than with the public. This occurs when the firms being regulated exert significant influence over the agencies that are supposed to oversee them.

For example, regulated firms may suggest appointees to the regulatory board, send lobbyists to argue on their behalf, provide information for regulatory decisions, and even offer well-paid jobs to individuals leaving the board. Consequently, such agencies may not effectively represent consumer interests, leading to regulations that favor the industry over the public.