00:01
So here we're talking about regulation, and i want to argue that the correct answer c here is cyclical unemployment, right? the idea here is that cyclical means related to business cycle, right? however, what we have here is a story about regulation, and regulation is not part of the business cycle, right? regulation is a structural phenomenon.
00:32
You might associate it with structural unemployment, but not cyclical unemployment, right? so absolutely, you would say maybe the regulation would affect structural unemployment, but it would never affect cyclical unemployment.
00:47
So it's very unlikely to produce that.
00:50
The rest, however, are plausible, right? if we go through the rest, imperfections, yes, this is plausible, right? because, you know, externalities might reemerge.
01:03
One of the reasons that government regulates industries is to try to cure or prevent or avoid market imperfection.
01:10
So giving up that regulatory mission might do this.
01:12
B, worse service.
01:15
Absolutely.
01:16
Right.
01:18
We have a tradeoff in terms of price and quality.
01:24
Government regulations often ensure a high quality product, albeit at a very high price...