Cost of providing the benefits of Protecting Consumers from Business Practices

Cost of providing the benefits of Protecting Consumers from Business Practices

Benefits of protecting consumers from business practices and form themselves justify the cost of providing that protection.

The fact that some protection is good does not mean that more protection is automatically better. There is a matter of cost of providing consumer protection.

(a) Economic cost: One category of consumer protection cost is the economic cost. Rising cost to sellers of product liability insurance, along with costs of defending charges of the FTC and other regulatory agencies, all result in higher product prices. Technological development costs as well as manufacturing costs of consumer protection devices, such as a belt, pollution control devices etc.

(b) Social cost: Another category of consumer protection cost is a social cost. One of the greatest potential social costs as the potential loss of individual freedom of choice. Loss of freedom is a social loss- perhaps even more serious than injury to some individuals. Should not the individual have the rights to nuke an occasional mistake which mistakes help us learn to be more responsible?

Another form of social cost concerns the government. Proliferation and expansion of consumer protection agencies increase the size of government and thereby may upset the pluralistic balance.

(c) Opportunity cost: The third category of consumer protection cost is an opportunity cost, and these costs arise from the ordering of social priorities. Resources used for one purpose make them unavailable for other use.

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