The Evolution Of Public Interest Standard As The Reason Of Price Regulation In American Law

Price regulation is the limitation to property right, and this limitation should be justified. In the judgments of United States Supreme Court, the public interest was often regarded as the reason of price regulation. From Munn Case to Nebbia Case, following the attitude of the court to the price regualtion changed, the meanings of public interest also changed. There are several processes: "public interest" was first regarded as the reason of price regulation; embodied standards which were "public use" and "virtual monopoly" occured; "emergency"; the "public use" standard was more reified and the "virtual monopoly" standard was more strengthened; "destructive competition" in 1930s'. Finally, the authority of the states to regulate price was affirmed constitutional.After World Warâ…¡, "public interest" was still the efficient standard in deciding whether the regulated price was constitutional. The Hope standard was established in Utility: Price regulation must balance the public interest and individual interest, the prices should enable a natural gas company to operate successfully, to maintain its financial integrity, to attract capital, and to compensate its investors for the risks assumed. Due to the serious shortage of energy sources in American that time, the court affirmed that the public interest could outweigh the individual interest in the special conditions when they explain and use the Hope Standard.After 1980, in the price regulation cases, the court viewed the public interest broadly to balance the public interest and individual interest. The meanings of public interest changed,but the analysis method of positivism always exist. This method can be used in the price regulation in China.There are two typical examples, the price regulation to Lanzhou beef noodle and the price regulation to convenience noodle in 2007. In these two cases, the Lanzhou beef noodle and the convenience noodle are both belong to the traditional private business, but the public interest in the two cases are different which could be analysed according to the method. So, with regard to whether the price regulations is necessary and valid, there are two different conclusions in these cases correspondingly.