Every product safety problems, many people would call upon a tube of the Government seems to be strengthening supervision is the only programme, seems to be a region of the private sector is unable to guarantee the safety of consumers.
Of course, businesses can be mercenary, but you know, the interest of consumers is an important part of the interests of businessmen; China Laptops Manufacturers access to customers, establishing a good reputation, to attract more consumers, that is anyone who wants to earn more profit and entrepreneurs dream of vision. A business input to establish their brand, and to some extent is the guarantee of product safety. Of course, the market is bound to opportunistic profiteers, selling unsafe products, and that government regulation is the best approach? Not necessarily.
(1) security is not the only
First, security not than all other index of only considerations; annual accident casualties who number huge, if will all vehicles limited speed in each hours 10 km within, that travel of security degree must sharply upgrade, traffic casualties rate must will huge declined, but didn't people will support this programme, because except security, we while value efficiency, and cost, factors, this truth also applies Yu other things. Therefore, any product you can often achieve sufficient security, but how to determine whether the "safe enough"? This involves everyone on safety, efficiency, cost, and other factors of preference, and the Government's lack of authority these individuals dispersed in the sea of knowledge, results control is often thought it reasonable in place across the Board.
Dang Government of regulatory sector forced all products must reached a standard, or requirements enterprise must get what Government issued of practice industry licence, this natural will makes some businesses of business cost raised, and this also will to price of form passed on to they of consumers--this on many more rich of people for no is effect, after all in market in the, many people also willing to for certification service paid some additional of costs for a relief. At this time the most vulnerable populations, it is the poor in the most disadvantaged in society, because they also have their costs for these requirements across the Board, which itself is probably not their demands. For example, using poor quality oils is strictly prohibited and will not let the first only eat 3 servings of fried noodles with inferior oil poor blink time is more expensive to eat fried flour, when quality bargains were banned, only to get the minimum 5 when a CHOW Mein, which for the lives of the poor at the bottom adds a pressure.
Perhaps you will say, this is for the sake of the health and safety of all, but not forget that value is subjective, each situation due to different reasons, preference ordering is different for factor do you think is the free choice of the people is more important? Is your personal preference is more important?
(2) marketing more effective
In a free market, entrepreneurs have to meet consumers ' needs in order to make a profit, they had to make a trade-off between the, all kinds of consumer demand will be in the market response. Widespread if consumers understand the products, reliability needs of enterprise manufacturers cater to this trend in order to increase their competitive advantage. In addition, the manufacturers own accreditation of rating services have not only demand, stores selling products would also not want to encounter clients with product problems go back trouble, so many brands to retailers will be more willing to buy with reliable ratings certified for sales of goods.
Of course, said of the enterprise itself, say their products are super-safe, Super reliable, this may not be trustworthy. At this point, the market will spontaneously led to a regulatory system; third party rating agencies appears in the market, for a variety of products through various laboratory tests to score. In order to win the trust of consumers, companies have voluntarily taken to rating certification examination, obtain the appropriate certificate or rating points, for consumers ' reference.
If, a home rating certification company not according to products itself to out evaluation, but which home Enterprise plug have money more on to that home gold main high points or certificate, that dang it by certification of products appeared quality security problem Shi, is the rating certification company points minutes will in market in the lost reputation, from it of evaluation no longer worth, enterprise also not again purchase it of service, but will products sent to more has fame, and more with authority of rating certification company get evaluation--results, this not responsible of rating certification company was market eliminated has.
But on the other hand, if a rating certification companies for unusually strict product inspection, product rating certification of the tedious and time-consuming process, which would not only give enterprises the amount paid for rating certification services more expensive, will also delay the product's launch time. Even worse is that was very strict ratings certification denial of this product if it is in the future that is actually safe and reliable, it will discredit-and, the overly restrictive rating certification company will be eliminated by the market.
So, the certification market competition between companies, so they must make a balance between prudence and efficiency, reputation and service levels is to fight it out.
Compared with, Government if monopoly has rating certification service, enterprise must from government organ get products certificate and sold qualification, is will is another a scene; due to in administrative monopoly of status, no industry of competition pressure, and regulatory sector through tax support, without faced closed failed of risk, they will may will tendencies Yu extreme to strictly and caution, and procrastination and low effect, because if a products get qualification Hou appeared serious problem, that made approval of officials of career may on end. Imagine if this delay by processes in the test product is a life-saving drug, this excessively strict or procrastination can kill people--for example, if a new drug could save 20,000 patients, but may have serious side effects on 3,000 patients; approval will take great risks and not, and how many people care about it? In 2014, the Oscar-winning movie the Dallas buyer's Club, reflecting the United States food and Drug Administration (FDA) in this issue.
In fact, even today the Government intervention of the times, excellent certification bodies formed in the market there are still many, UL (Underwriters Laboratories) is one example. UL was founded in 1894, is a wholly private certification bodies. UL employ thousands of scientists, engineers, safety technicians, testing tens of thousands of species, each year hundreds of thousands of products, you many kinds of electronic products, computers, shavers, hair dryers is likely to print UL certification mark. UL regulatory agencies, are not mandatory, but many companies will voluntarily sent the product to UL testing, it is because the UL has an excellent reputation as well as on the product safety authority. UL itself is viable for those who believe that only the Government reliable argument is powerful evidence to the contrary.
(3) the naïve assumptions
To note is that discussed above were founded by the Government monopoly of supervisory management and qualification under the assumption of service there is no corruption, and this assumption, I am afraid that is difficult to achieve in any country.
Public choice theory (Public Choice Theory) it is important, that is, "symmetry"-If you think that private rating certification Enterprise engages in, what makes you think that replaced government official problem solved? Enterprise of the person and the people in the Government, we are all human; you judge the logic should be the same. But, in a free market, and a more efficient operation with elimination mechanism.
Also has Nobel economics Award winner Stigler (George Stigler, 1911 ~ 1991) proposed had a concept, called "regulation captured" (Regulatory Capture), that some big group can captured Government of regulatory sector, formed interests partners, eventually, many industry of regulations simply directly by giant Enterprise drafted has, for industry set has more high of threshold, and more of control, results is promote has giant Enterprise row industry of really monopoly, While small businesses out of the market by Decree, this relationship is commonly known as "crony capitalism" (but in fact is not capitalism at all), this phenomenon in Stigler's hometown United States one after another.
United States food and Drug Administration (FDA) are often considered to be the most impartial and reliable government regulators, but it may also be a big assumption; United States Drug Administration study, another Nobel Laureate, Coase (Ronald Coase, 1910 ~ 2013) the evaluation is given:
"The gains (if any) which accrued from the exclusion of ineffective or harmful drugs were far outweighed by the benefits foregone because effective drugs were not marketed"
"Obtained from the exclusion invalid or harmful drug benefit (if there are any good), given up by far refused to approve the drug listing effective benefits. ”
When product safety management by government monopolies, and all kinds of mandatory regulatory requirements, this will not only create these problems, can also cause "moral hazard" (Moral Hazard), but this is another huge topic.
Compared Xia, free market of a regulatory system, it than currently General by government monopoly of regulatory and certification service more efficient, Prime For Business and more reliable, because this is market in the many individual according to their needs contributed to of spontaneous order--from producers, and retailers, and rating certification company, to a has different risk preference of consumers, even to to they calculation premium of insurance company, they are in up with role--market of possibilities and potential probably is mass to full imagine of. Respect the needs of all levels of the free market, of course, everyone and therefore responsible for your own account you want more, it's part of freedom.