ST12.1 Capture Problem. It remains a widely held belief that regulation is in the public interest and influences firm behavior toward socially desirable ends. However, in the early 1970s, Nobel laureate George Stigler and his colleague Sam Peltzman at the University of Chicago introduced an alternative capture theory of economic regulation. According to Stigler and Peltzman, the machinery and power of the state are a potential resource to every industry. With its power to prohibit or compel, to take or give money, the state can and does selectively help or hurt a vast number of industries.

Because of this, regulation may be actively sought by industry. They contended that regulation is typically acquired by industry and is designed and operated primarily for industry's benefit.?