Regulated Market


DEFINITION of 'Regulated Market'

A medium for the exchange of goods or services over which a government body exerts a level of control. This control may require market participants to comply with environmental standards, product-safety specifications, information disclosure requirements and so on.

The market for both prescription and over-the-counter drugs is an example of a regulated market. The Food and Drug Administration (FDA), a federal government body, tightly controls what drugs may be sold on the market, how they may be advertised, for what conditions they may be prescribed and more.

BREAKING DOWN 'Regulated Market'

Regulated markets provide obvious protection for consumers. However, some argue that the formal regulation of markets is unnecessary and imposes inefficiencies and unnecessary costs on markets and on taxpayers. These people argue that there are plenty of ways for markets to self-regulate.

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