The concerned industries are benefited from making it own regulations and rules. The government plays a crucial role in enforcing the key regulations established by the overall industry. The regulations are used by the government for the achievement of its national economic objectives. As a significant example, the government can consider granting subsidies across the industry for increasing the value of prices. The theory has been allowing decision making of politics in concern with the industry for being done across the industry, rather than on individual basis. This is further helpful in the reduction of money, energy and time. There must be an involvement of the industry in the decision making of the government over economic factors affecting the entire industry.
However, the theory has been criticized as the idea for utilizing representative groups for the regulation of the industry and the economy-based activities across the nation might be favourable for some groups in comparison with the other. Further ahead, there is lack of predictability among politicians as they have been putting up regulations for perceiving their own personal interests. The costs of production may involve certain variations in different geographical locations. These further result in creating more profits for some industries in comparison with other industries. There seems to be no predictability of the politicians as they can be seen putting regulations for the purpose of their own benefits. They may consider supporting the private sector in order to perceive their personal interests. And hence the theory can be criticized in these ways.
After selecting a media release and newspaper article, the focus will be over resource super profits tax proposed through Rudd, replacement of the tax with the tax of MRRT through Gillard and the recent MRRT repeal made through Abott, PM. Focusing on these answer will be given to identifying the regulation theory that properly explains governments position, when RSPT was proposed with justification on the same.