Regulatory interventions should be proportionate to market failures from "summary" of The Economics of Regulation: Principles and Institutions: Economic principles by Alfred Edward Kahn
The principle that regulatory interventions should be proportionate to market failures is a fundamental concept in the field of economics. When considering whether to intervene in a market, policymakers must carefully evaluate the extent and impact of the market failure in question. If a market failure is relatively minor or localized, then heavy-handed regulatory interventions may do more harm than good. In such cases, it may be more appropriate to rely on market forces to correct the failure over time. However, if a market failure is significant and widespread, then regulatory intervention may be necessary to protect consumers and ensure fair competition. The key is to strike a balance between allowing markets to function efficiently and addressing failures that can have serious economic or social consequences. This requires a nuanced understanding of the specific market failure at hand and the potential...
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