Regulation - Job Killers or Overhyped Rhetoric?

by William Achnitz III on Mar 1, 2015 | Views: 339 | Score: 1
Related to Environmental Regulations14000
Not Related to Environmental Regulations618000
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William Achnitz III
William Achnitz III on Mar 1, 2015 2:52 AM said:

Between 1984 and 1994, total environmental expenditures measured by the Pollution Abatement Cost and Expenditure survey in all manufacturing industries rose by $4.9 billion. During that same period, total production employment in the same industries declined by almost 632,000 jobs. In a 2000 study, applying the most adverse estimates Morgenstern, Pizer, and Shih found that environmental spending may have accounted for the loss of at most 14,000 jobs. The same study also makes the point that regulation often translates to jobs being created. So, isn't regulation really just a jobs distributor?

Christian Stellakis
Christian Stellakis on Mar 1, 2015 7:27 PM said:

This is a very interesting chart. Unfortunately, though, regulation isn't simply a jobs distributor. In most cases (not all, but most) markets act as efficient distributors of resources, allocating on the basis of price, supply and demand. Oftentimes, regulation, when excessively applied, can distort markets by placing additional requirements on suppliers or limitations on consumption. Consequently, the excessive additional regulation results in a greater cost for the product, or a market system that functions less efficiently. If regulation was simply a means of redistributing jobs, then we would observe a greater degree of success in command economies such as Cuba, North Korea, and the former Soviet Union. Instead, though, we find that these economies often under-perform relative to their market-economy counterparts, and in the case of the Soviet Union, collapse under their own weight.

William Achnitz III
William Achnitz III on Mar 5, 2015 2:51 PM said:

Christian - I wholeheartedly agree with everything you just said. My intention on making a chart of this statistic was to merely demonstrate how regulation doesn't simply function as a "job killer." To me, the notion that any regulation is the root of all evil is ridiculous, which is unfortunately how it is often portrayed by politicians, pundits, and the like.

With that said, I don't think there is any argument for implementing "excessive" regulation. However, I do believe in many instances where there should be a minimum level of regulation. Otherwise, those externalities are just borne by someone else and by that I mean us.

Peter Graham
Peter Graham on Mar 8, 2015 11:29 AM said:

I agree with regulation to a certain degree as a crucial necessity. Anarchy has been largely rejected as a model for society. Likewise, economic anarchy is no way to structure an advanced capitalist system where certain burdens and externalities can be effortlessly shifted around by those with the most financial clout.

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