Decentralization
Market

Market decentralization can be done through privatization of public owned functions and businesses, as described briefly above. But it also is done through deregulation, the abolition of restrictions on businesses competing with government services, for example, postal services, schools, garbage collection. Even as private companies and corporations have worked to have such services contracted out to or privatized by them, others have worked to have these turned over to non-profit organizations or associations.

From the 1970s to the 1990s, there was deregulation of some industries, like banking, trucking, airlines and telecommunications, which resulted generally in more competition and lower prices. According to the Cato Institute, an American libertarian think-tank, in some cases deregulation in some aspects of an industry were offset by increased regulation in other aspects, the electricity industry being a prime example. For example, in banking, Cato Institute believes some deregulation allowed banks to compete across state lines, increasing consumer choice, while an actual increase in regulators and regulations forced banks to make loans to individuals incapable of repaying them, leading eventually to the financial crisis of 2007–2008.

One example of economic decentralization, which is based on a libertarian socialist model, is decentralized economic planning. Decentralized planning is a type of economic system in which decision-making is distributed amongst various economic agents or localized within production agents. An example of this method in practice is in Kerala, India which experimented in 1996 with the People's Plan campaign.

Emmanuelle Auriol and Michel Benaim write about the "comparative benefits" of decentralization versus government regulation in the setting of standards. They find that while there may be a need for public regulation if public safety is at stake, private creation of standards usually is better because "regulators or 'experts' might misrepresent consumers' tastes and needs." As long as companies are averse to incompatible standards, standards will be created that satisfy needs of a modern economy.
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