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A close relationship developed between the oil industry and the agency charged with regulating drilling. This relationship is an example of

A. Effective regulatory practice
B. Safeguarding the public interest
C. Agency capture
D. Cultivating industry cooperation with regulatory policy
E. Information gathering

Expert Answers

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The best answer to this question is Option C.  This is an instance of agency capture. 

In a system like that of the United States, government agencies are assigned to regulate certain industries.  Because the industries are affected by the agencies’ regulations, the industries try hard to have influence over the agencies.  This can cause the agencies to become beholden to the industry.  The industry cares more than anyone else about the agency’s regulations and puts pressure on the agency and on the elected officials who oversee it. No one puts very much pressure on the agency or the elected officials to counterbalance the industry’s pressure.  Eventually, this can influence the agency to work closely with the industry and to shape its regulations in ways that help the industry.  At this point, we say that the agency has been captured.  This sounds like the situation in your question, so Option C is the best answer.

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