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Regulation can be both beneficial and serve as a barrier to entry that protects the incumbents. In fact, that's probably the common case. It's worth recognizing
by eloff 7y ago
Regulation can be both beneficial and serve as a barrier to entry that protects the incumbents. In fact, that's probably the common case. It's worth recognizing that there are these two competing interests, that every regulation bears this hidden cost, and that the benefit had better be enough to justify that cost. I think often this is not true. Regulations could often be much less burdensome while still achieving most of the benefits.
- jklehm 7y agoI think most regs were driven by events or behaviors at the time of their creation. To revert them I'd hope there'd be a compelling case as to why the catalyst that brought the regs into existence no longer applies or will not reappear in the future. I'm not sure that it's an easy process.
- eloff 7y agoEasy, no. Necessary, yes. Imagine a world where regulations only grow on the whole. How far out do you have to extrapolate that system for it to implode under its own weight? That can happen to nation states too...
- tatersolid 7y ago> Imagine a world where regulations only grow on the whole. This is the world in which we currently live.
- tathougies 7y agoRight and it leads to several negative externalities, such as high income inequality: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2869155 https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2869155
- jklehm 7y agoIs the idea that they are never refactored? I don't know that that's true, we see changes to the regs somewhat often: simplifications, clarifications typically?
- salawat 7y agoThe solution to that is in having regulations enforcement gradually eased in. It is kind of a given that a newcomer to an industry won't be compliant with everything and will need time to build up to full regulatory compliance. The idea then is for the regulator to work out a compliance roadmap which the regulated commits to, and is audited for compliance with occasionally. Think of it as a learning experience for small businesses. We would have to do a much better job at keeping track of people's association through corporation's however, as it would lead to an unintended incentive to just dissolve a company when the regulatory compliance costs heat up, reform a new one, and reset the level of regulatory expectation.