PUBLICATIONS
Books
The Independent Review
(Quarterly Journal)
Policy Reports
The Lighthouse
(Email Newsletter)
Commentary Articles
News Releases
Audio and Visual Programs
The Independent
(Quarterly Newsletter)
Research Articles
Working Papers
Course Adoption Program




Subscribe



Commentary
Facebook Facebook Facebook Facebook

Contribute
Your participation will advance liberty. Join us as an Independent Institute member.



Contact Us
The Independent Institute
100 Swan Way
Oakland, CA 94621-1428

510-632-1366 Phone
510-568-6040 Fax
Send us email


Interested in working with us?  Click here for more information.

Bookmark and Share    

Regulation Reform
By David E. Vance
This article appeared in the Fall 2012 issue of The Independent Review


Abstract

Attempts at regulatory reform have failed to reduce substantially the burden of regulation and have often resulted in greater regulation. Real reform requires a dramatic change in the regulatory framework and a Congress willing to resist pressure from special-interest lobbyists.


Article

The cost of regulation has four elements: (1) compliance costs, (2) opportunity costs, (3) defense costs, and (4) governmental administrative costs. Defense costs are costs to defend against allegations that rules and regulations were violated. The Small Business Administration estimates that the cost of compliance, defense, and government administration in the United States is about $1.75 trillion (Crain and Crain 2010, 12).

Opportunity costs are much harder to estimate and may have a bigger impact on the economy. There are two kinds of opportunity costs: the cost of delay and the benefits forgone in connection with projects not undertaken. Regulation has a chilling effect and discourages people from taking chances on innovative products and services. For example, Goldman Sachs decided it was unable to offer Facebook shares to U.S. investors because of uncertainty over the Security and Exchange Commission’s (SEC) interpretation of law and regulations (Macey 2011). Although Facebook will eventually go public, regulatory uncertainty has created a delay of more than eighteen months at this writing. Eighteen months in the fast-moving world of global commerce is almost an eternity....




Volume 17 Number 2
Fall 2012

Subscribe Today

Buy Single Issues

Independent Review Issues

Articles by Subject

Independent Review Articles on Related Subjects




Home | About Us | Blogs | Issues | Newsroom | Multimedia | Events | Publications | Centers | Students | Store | Donate

Product Catalog | RSS | Jobs | Course Adoption | Links | Privacy Policy | Site Map
Facebook Facebook Facebook Facebook
Copyright 2014 The Independent Institute