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Wednesday, December 26, 2012

Mulligan: Measuring Regulation

New York Times:  A Budget for Regulation, by Casey B. Mulligan (University of Chicago, Department of Economics):

As Democrats and Republicans haggle over federal taxes and spending, another important policy tool gets less attention: regulation.

Government has a variety of ways it can achieve its objectives, including subsidies, taxes and regulation. For example, the government might attempt to help disabled people by subsidizing handicapped-accessible buildings. Or it could levy an extra tax on buildings that are not handicapped-accessible. Or it could simply refuse to permit structures to be built, or used in various situations, without being handicapped-accessible.

All three strategies are likely to affect building activity, increase the prevalence of handicapped-accessible buildings and in so doing help people with disabilities, as intended. The first strategy is ordinarily called government spending; the second, taxation; and the third, regulation. Private-sector activities to comply with regulation do not appear in the government budget, whereas private-sector interactions with tax and spending programs do, in terms of the amount of money they pay or receive. ...

Because regulations have so far been poorly quantified, it is interesting to see a recent study of workplace regulation by complianceandsafety.com. It attempts to measure the aggregate of importance of workplace regulation by the dollar amount of fines collected by the Occupational Safety and Health Administration. Its chart, reproduced below, looks at the fines in reverse chronological order, and colors years according to the political party of the president in power.

OSHA fines have increased sharply since 2009. Perhaps more surprising is that the largest fine increases previously were under a Republican president (the first President George Bush) and the largest reductions were under President Bill Clinton.

As with taxes and spending, we cannot necessarily conclude that more regulation is “bad” or “good,” but it would be helpful for experts and voters alike to see a rigorous accounting for government regulation.

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Comments

By convention, graphs show time moving from left to right.

Posted by: Anonymous | Dec 26, 2012 7:55:19 AM

It would probably be difficult to prove empirically, but in the field it appears the Obama administration has focused enforcement on non-union contractors and shops.

Posted by: save_the_rustbelt | Dec 27, 2012 7:07:16 AM

"[Fairly un]surprising is that the largest fine increases previously were under a [Democrat-controlled Congress] and the largest reductions were under [Republican-controlled Congress]."

FTFY.

Posted by: Ben | Dec 27, 2012 8:53:25 AM