When organization encounters uncertainty in regulatory times
Regulatory policy is a considerable factor in organizational business strategy decisions. This article puts focus on the evaluation of the regulatory policy from the perspective of the organizational cost under uncertainty. In this paper I examine the organizational cost of policy transition in different scenarios, and consider, further, what the impact on the macroeconomic and business policy would be. Three conclusions are reached: 1. The cost of strategy adoption of organizations under regulation in a monopolized industry is only affected by their own risk tolerance of uncertainty and the cost of information; 2. when the regulation is enacted in a more competitive market, the cost of information would raise with a higher expected loss comparing with the same regulation in monopolized market; 3. If the claim of such measurement is true, the net benefit or loss of regulation is exactly the difference between organizational information cost and regulatory benefit. So the policy that guarantees the positive communication and transparent information exchange that helps to reduce the organizational information cost is necessary for an efficient regulatory policy.
|Date of creation:||22 May 2011|
|Date of revision:|
|Publication status:||Published in International Journal of Applied Business and Economic Research 9.2(2011): pp. 177-184|
|Contact details of provider:|| Postal: |
Web page: http://mpra.ub.uni-muenchen.de
More information through EDIRC
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Alberto Martin & Jaume Ventura, 2010.
"Theoretical Notes on Bubbles and the Current Crisis,"
519, Barcelona Graduate School of Economics.
- Alberto Martin & Jaume Ventura, 2011. "Theoretical Notes on Bubbles and the Current Crisis," IMF Economic Review, Palgrave Macmillan, vol. 59(1), pages 6-40, April.
- Alberto Martin & Jaume Ventura, 2010. "Theoretical Notes on Bubbles and the Current Crisis," NBER Working Papers 16399, National Bureau of Economic Research, Inc.
- Martin, Alberto & Ventura, Jaume, 2010. "Theoretical Notes on Bubbles and the Current Crisis," CEPR Discussion Papers 8038, C.E.P.R. Discussion Papers.
- Martin, Alberto & Ventura, Jaume, 2011. "Theoretical notes on bubbles and the current crisis," Working Paper Series 1348, European Central Bank.
- Alberto Martin & Jaume Ventura, 2010. "Theoretical notes on bubbles and the current crisis," Economics Working Papers 1222, Department of Economics and Business, Universitat Pompeu Fabra, revised Feb 2011.
- Tilman Brück, 2004.
"An Economic Analysis of Security Policies,"
Discussion Papers of DIW Berlin
456, DIW Berlin, German Institute for Economic Research.
- Gary Fromm, 1981. "Studies in Public Regulation," NBER Books, National Bureau of Economic Research, Inc, number from81-1, May.
- Georges Enderle, 2009. "A Rich Concept of Wealth Creation Beyond Profit Maximization and Adding Value," Journal of Business Ethics, Springer, vol. 84(3), pages 281-295, February.
- Rolf H. Weber, 2010. "Multilayered Governance in International Financial Regulation and Supervision," Journal of International Economic Law, Oxford University Press, vol. 13(3), pages 683-704, September.
- Georges Enderle, 2010. "Wealth Creation in China and Some Lessons for Development Ethics," Journal of Business Ethics, Springer, vol. 96(1), pages 1-15, September.
- George Lermer & W. T. Stanbury, 1985. "Measuring the Cost of Redistributing Income by Means of Direct Regulation," Canadian Journal of Economics, Canadian Economics Association, vol. 18(1), pages 190-207, February.
When requesting a correction, please mention this item's handle: RePEc:pra:mprapa:36240. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Ekkehart Schlicht)
If references are entirely missing, you can add them using this form.