Why are rules and regulations required in the market place? Explain with reasons.
Rules and regulations are required in the market place due to the following reasons:
- Industrial consumers often find themselves in a weak position.
- Whenever there is a complaint regarding a good or service that had been bought, the seller tries to shift all the responsibility on to the buyer.
- Market do not work in fair manner when producers are few and powerful whereas, consumers purchase in small amounts and or scattered. This happens especially when large companies are producing these goods. These companies with huge wealth, power and reach can manipulate the market in various ways.
- Consumers are exploited in the market place in the following ways:
- Shopkeepers weigh measure less than what they.should.
- Adulterated or defective goods are sold in market.
- Sometimes they charge more price.
- Hoarding and black marketing practices are also prevailed in the market.
- At times, false information is passed on through the media and other sources to attract consumers.
For example; a company for years sold powder milk for babies all over the world, claiming this to be better than mother’s milk. It took years of struggle before the company was forced to accept that it had been making false claims.