4 ms·

Pretty much any regulation harms business. The smaller the business, the more toll new regulations usually have on it. The more regulations we enact, the more b

Pretty much any regulation harms business. The smaller the business, the more toll new regulations usually have on it. The more regulations we enact, the more big companies grow and small companies die/not started. It acts like a positive feedback loop because the whole reasons for most regulations in the first place was to tame big evil corporations, which in the end usually benefit more from regulations (less competition). Also, consumer pays for any regulation costs anyway, so everything becomes more expensive with more regulation. It might not be immediately noticeable, but it's definitely the trend in the long term. I'm not saying that we don't need any regulations at all, but I think we should strive to keep it to absolutely bare minimum.

rad_gruchalski 8y ago
Hence there are processes in the EU to take care of due dilligence. I take EU over US any day.
lkrubner 8y ago
There is no way for these two statements to both be true: 1.) Pretty much any regulation harms business. 2.) Also, consumer pays for any regulation costs anyway, If consumers pay for the regulation, then the business is not harmed. But think about how silly that would sound if you said that to a business person: "Don't worry about government regulations, because your customers will pay for them!" This is an old fallacy: "consumer pays for any regulation costs anyway" Consumers don't pay for regulations except in those situations where demand for a product/service outstrips supply, and therefore the businesses are able to pass the cost along to the consumers. But wherever supply outstrips demand, then the businesses pay for the regulation themselves, via reduced profits and therefore reduced market value. This is simple supply and demand. It is remarkable that so many people are often mislead on this subject.
- sib 8y ago
  "Consumers don't pay for regulations except in those situations where demand for a product/service outstrips supply." This doesn't make sense. Demand may outstrip supply at a certain price, but that just means that the price must go up. If a market is clearing, then the regulation (or a tax) will be borne by buyers or sellers in proportion to the relationship between the supply and demand elasticities.
- tananaev 8y ago
  Regulation harms business (mostly smaller) in the short term. Consumer pays for regulation in the long term.
xoa 8y ago
>Pretty much any regulation harms business. That's ridiculous. The Free Market is one of the greatest economic tools we've ever discovered, and hybrid distributed representative/micro constitutional monarchies a successful governance/innovation model. Together they're the foundation for most of modern business and are a direct creation of regulation and maintained by the same. The Free Market has requirements for operation like any tool. I really have trouble understanding how you could argue that business would be better off under mercantilism and aristocracy or any other older, less efficient system. They don't work as well in known theory and haven't worked as well in practice either. Good vs bad governance is very important, but "more" vs "less" not so much. Just like anything else implementation matters the most.
- tananaev 8y ago
  I'm not arguing for any specific government model in my comment. I'm stating that less intervention from government is better for business.
  - xoa 8y ago
    >I'm stating that less intervention from government is better for business. And I'm saying you're wrong since the Free Market and our current governance models and public buy-in and wealth distributions have led the greatest business success and innovation in the entirety of human history. Good intervention from government has been fantastic for business.
    - tananaev 8y ago
      Then how you can explain gradual slow down in the rate of growth in the last decades? I think it is caused by increase in regulations. Any significant innovation beyond small incremental improvements in many industries is completely paralysed because of regulation. Internet and tech industry is on the same path, in my opinion.
      - mcphage 8y ago
        > Then how you can explain gradual slow down in the rate of growth in the last decades? http://www.multpl.com/us-population-growth-rate http://www.multpl.com/us-population-growth-rate
adrianN 8y ago
That's okay, because politics isn't just about helping businesses. It's mainly about helping people. Sometimes that means helping businesses, but sometimes it means harming them.
- deleted 8y ago
  [deleted]
- simula67 8y ago
  > politics isn't just about helping businesses. It's mainly about helping people Many politicians are not about helping people, many are about helping themselves. Also, sometimes you can harm people with the intention of helping them
  - adrianN 8y ago
    So? The system isn't perfect. That doesn't help in deciding whether more or less regulation is better.
    - AnthonyMouse 8y ago
      > So? The system isn't perfect. That doesn't help in deciding whether more or less regulation is better. The entire concept of "more or less regulation" is partisan ideology. Every regulation has a cost and a benefit. Good regulations have benefits in excess of their costs. The problem is that calculating the cost is very difficult. You may have a regulation that increases costs by $10 and produces a $12 benefit. But if the $10 cost increase drives a competitor out of business and allows the remaining provider to raise prices by $20 in total, you're now paying $20 for a $12 benefit. They also have opportunity costs. You may have a regulation that consumes $20 of a $30 surplus but produces $50 in diffuse positive externalities, which sounds like a good idea. But if there is an alternative that also consumes $20 of the same $30 surplus and produces $500 in positive externalities, you can't have both ($40 > $30) and enacting the first one is really destroying $450 in benefits relative to the second. Trying to enact both is even worse, because then you get neither one and even destroy any benefits inherent in the original transaction. It's so easy to screw this up that it's better to err on the side of not regulating something than to convince yourself you gained $30 when you really destroyed $1000. The regulations you want are the ones that have unambiguous, huge net benefits, like prohibiting people from dumping toxic waste in the river, because the cost is low and the benefit is enormous. But even then you have to be careful, because if you're spending $50,000 to prevent $50,000,000 in harm, you could still be wasting $40,000 because there is a way to do it for $10,000. And the incentives are wrong for people to carefully evaluate things like this, because the people paying the cost aren't the people creating the rules. Which means "all regulation is bad" is false but "any given regulation is bad" is a solid heuristic.

rad_gruchalski 8y ago

Hence there are processes in the EU to take care of due dilligence. I take EU over US any day.

lkrubner 8y ago

There is no way for these two statements to both be true: 1.) Pretty much any regulation harms business. 2.) Also, consumer pays for any regulation costs anyway, If consumers pay for the regulation, then the business is not harmed. But think about how silly that would sound if you said that to a business person: "Don't worry about government regulations, because your customers will pay for them!" This is an old fallacy: "consumer pays for any regulation costs anyway" Consumers don't pay for regulations except in those situations where demand for a product/service outstrips supply, and therefore the businesses are able to pass the cost along to the consumers. But wherever supply outstrips demand, then the businesses pay for the regulation themselves, via reduced profits and therefore reduced market value. This is simple supply and demand. It is remarkable that so many people are often mislead on this subject.

sib 8y ago
"Consumers don't pay for regulations except in those situations where demand for a product/service outstrips supply." This doesn't make sense. Demand may outstrip supply at a certain price, but that just means that the price must go up. If a market is clearing, then the regulation (or a tax) will be borne by buyers or sellers in proportion to the relationship between the supply and demand elasticities.
tananaev 8y ago
Regulation harms business (mostly smaller) in the short term. Consumer pays for regulation in the long term.

xoa 8y ago

>Pretty much any regulation harms business. That's ridiculous. The Free Market is one of the greatest economic tools we've ever discovered, and hybrid distributed representative/micro constitutional monarchies a successful governance/innovation model. Together they're the foundation for most of modern business and are a direct creation of regulation and maintained by the same. The Free Market has requirements for operation like any tool. I really have trouble understanding how you could argue that business would be better off under mercantilism and aristocracy or any other older, less efficient system. They don't work as well in known theory and haven't worked as well in practice either. Good vs bad governance is very important, but "more" vs "less" not so much. Just like anything else implementation matters the most.

tananaev 8y ago
I'm not arguing for any specific government model in my comment. I'm stating that less intervention from government is better for business.
- xoa 8y ago
  >I'm stating that less intervention from government is better for business. And I'm saying you're wrong since the Free Market and our current governance models and public buy-in and wealth distributions have led the greatest business success and innovation in the entirety of human history. Good intervention from government has been fantastic for business.
  - tananaev 8y ago
    Then how you can explain gradual slow down in the rate of growth in the last decades? I think it is caused by increase in regulations. Any significant innovation beyond small incremental improvements in many industries is completely paralysed because of regulation. Internet and tech industry is on the same path, in my opinion.
    - mcphage 8y ago
      > Then how you can explain gradual slow down in the rate of growth in the last decades? http://www.multpl.com/us-population-growth-rate http://www.multpl.com/us-population-growth-rate

adrianN 8y ago

That's okay, because politics isn't just about helping businesses. It's mainly about helping people. Sometimes that means helping businesses, but sometimes it means harming them.

deleted 8y ago
[deleted]
simula67 8y ago
> politics isn't just about helping businesses. It's mainly about helping people Many politicians are not about helping people, many are about helping themselves. Also, sometimes you can harm people with the intention of helping them
- adrianN 8y ago
  So? The system isn't perfect. That doesn't help in deciding whether more or less regulation is better.
  - AnthonyMouse 8y ago
    > So? The system isn't perfect. That doesn't help in deciding whether more or less regulation is better. The entire concept of "more or less regulation" is partisan ideology. Every regulation has a cost and a benefit. Good regulations have benefits in excess of their costs. The problem is that calculating the cost is very difficult. You may have a regulation that increases costs by $10 and produces a $12 benefit. But if the $10 cost increase drives a competitor out of business and allows the remaining provider to raise prices by $20 in total, you're now paying $20 for a $12 benefit. They also have opportunity costs. You may have a regulation that consumes $20 of a $30 surplus but produces $50 in diffuse positive externalities, which sounds like a good idea. But if there is an alternative that also consumes $20 of the same $30 surplus and produces $500 in positive externalities, you can't have both ($40 > $30) and enacting the first one is really destroying $450 in benefits relative to the second. Trying to enact both is even worse, because then you get neither one and even destroy any benefits inherent in the original transaction. It's so easy to screw this up that it's better to err on the side of not regulating something than to convince yourself you gained $30 when you really destroyed $1000. The regulations you want are the ones that have unambiguous, huge net benefits, like prohibiting people from dumping toxic waste in the river, because the cost is low and the benefit is enormous. But even then you have to be careful, because if you're spending $50,000 to prevent $50,000,000 in harm, you could still be wasting $40,000 because there is a way to do it for $10,000. And the incentives are wrong for people to carefully evaluate things like this, because the people paying the cost aren't the people creating the rules. Which means "all regulation is bad" is false but "any given regulation is bad" is a solid heuristic.