business environment in which market competitors are controlled more by market forces rather than by government regulation, with the aim of creating a more efficient marketplace by substituting market discipline for the hand of government. The regulatory framework in the financial services industry, created by the banking act of 1933, was modified substantially in the 1980s. Deposit interest rate ceilings were abolished and financial institutions were permitted to offer a wider range of new services, allowing commercial banks and thrift institutions to pay market rates for deposits and compete more effectively with nonbank financial companies.See also depository institutions deregulation and monetary control act; Garn-st Germain Depository Institutions Act.
reducing government regulation in order to allow freer markets to create a more efficient marketplace. Industries such as communications, banking, securities, and transportation have been deregulated, with resulting increased competition, heightened innovation, and mergers among weaker competitors. Some government oversight usually remains after deregulation.
greatly reducing government regulation in order to allow freer markets to create a more efficient marketplace. After the stock-brokerage industry was deregulated in the mid-1970s, commissions were no longer fixed. After the banking industry was deregulated in the early 1980s, banks were given greater freedom in setting interest rates on deposits and loans. Industries such as communications and transportation have also been deregulated, with similar results: increased competition, heightened innovation, and mergers among weaker competitors. Some government oversight usually remains after deregulation.
