The existence of economies of scale may, in some circumstances, also create a rationale for targeted government interventions in the economy – in other words, industrial policy. The premise of industrial policy is that large-scale industries may not be able to get off the ground without government support or protection, given the substantial start-up costs and the existence of more-efficient competitors in other countries.
Periods of deregulation have usually been followed by a crisis, then followed by a period of reregulation, and again by a period of deregulation. It is precisely in phases of re-regulation that banks tend to complain about the time and money it costs – and the present period is no exception. But are we really overregulating?