Regulation can take many forms: legal restrictions promulgated by a government authority, contractual obligations (for example, contracts between insurers and their insureds), social regulation (e.g. norms), co-regulation, third-party regulation, certification, accreditation or market regulation.
State-mandated regulation is government intervention in the private market in an attempt to implement policy and produce outcomes which might not otherwise occur, ranging from consumer protection to faster growth or technological advancement. The regulations may prescribe or proscribe conduct ("command-and-control" regulation), calibrate incentives ("incentive" regulation), or change preferences ("preferences shaping" regulation"). Common examples of regulation include controls on market entries, prices, wages, development approvals, pollution effects, employment for certain people in certain industries, standards of production for certain goods, the military forces and services. The economics of imposing or removing regulations relating to markets is analysed in regulatory economics.
In some countries (in particular the Scandinavian countries) industrial relations are to a very high degree regulated by the labour market parties themselves (self-regulation) in contrast to state regulation of minimum wages etc.
Regulations may create costs as well as benefits and may produce unintended reactivity effects, such as defensive practice. Efficient regulations can be defined as those where total benefits exceed total costs.
Regulations can be advocated for a variety of reasons, including: