The Chicago School versus Public Utility Regulation

The Chicago School, while it has served to promote discussion on regulation of public utilities, has not provided adequate alternatives or consistent, unbiased criticism. Representatives of the Chicago School tend to be uncompromising in their position concerning the inability of government regulations to promote efficient allocation of resources. The Chicago School is also criticized for oversimplifying the issues. Historically, while the Chicago School saw all forms of monopoly as the great enemy of democracy, it has shown a trend since the 1960's of looking at private monopoly as a lesser evil than public monopoly. This shift in emphasis has included a proposed passive role for the government, preservation of the market, emphasis on abstract policies, and reliance on the consumer as the final arbiter. A review of these positions points out their limitations. (51 references) (DCK)