Sam Peltzman's paper presents a general theory of regulation, building on George Stigler's work. Stigler's theory challenges traditional views of regulation as a tool to correct market failures, instead emphasizing the political process and the influence of regulatory agencies on wealth distribution. Peltzman argues that regulatory agencies are not solely focused on a single economic interest, but rather are influenced by political pressures and the distribution of wealth. He highlights the role of political processes in shaping regulatory outcomes, and the importance of group size and organization in determining the effectiveness of regulation. Peltzman's model extends Stigler's work by analyzing the political process as a market for wealth redistribution, where regulatory agencies act as intermediaries between different economic interests. He shows that the size of the dominant group in regulatory processes is limited by the costs of organizing and the effectiveness of political support. The model also considers the impact of changes in economic conditions, such as cost and demand shifts, on regulatory outcomes. The paper discusses the implications of regulation on price and profit outcomes, and how regulatory decisions are influenced by the political process. It also addresses the relationship between regulation and productivity, and how changes in demand and cost affect regulatory decisions. Peltzman concludes that regulation is not a simple tool for correcting market failures, but rather a complex political process influenced by a variety of economic and political factors. The paper highlights the importance of understanding the political economy of regulation in order to develop effective regulatory policies.Sam Peltzman's paper presents a general theory of regulation, building on George Stigler's work. Stigler's theory challenges traditional views of regulation as a tool to correct market failures, instead emphasizing the political process and the influence of regulatory agencies on wealth distribution. Peltzman argues that regulatory agencies are not solely focused on a single economic interest, but rather are influenced by political pressures and the distribution of wealth. He highlights the role of political processes in shaping regulatory outcomes, and the importance of group size and organization in determining the effectiveness of regulation. Peltzman's model extends Stigler's work by analyzing the political process as a market for wealth redistribution, where regulatory agencies act as intermediaries between different economic interests. He shows that the size of the dominant group in regulatory processes is limited by the costs of organizing and the effectiveness of political support. The model also considers the impact of changes in economic conditions, such as cost and demand shifts, on regulatory outcomes. The paper discusses the implications of regulation on price and profit outcomes, and how regulatory decisions are influenced by the political process. It also addresses the relationship between regulation and productivity, and how changes in demand and cost affect regulatory decisions. Peltzman concludes that regulation is not a simple tool for correcting market failures, but rather a complex political process influenced by a variety of economic and political factors. The paper highlights the importance of understanding the political economy of regulation in order to develop effective regulatory policies.