Regulatory and public policy impediments are hindering opportunities for business growth across many industries and markets, deterring private enterprise and investment, imposing barriers to market entry and reducing competition. That, in turn, leads to reduced economic output and lost jobs, as well as leading to consumer welfare losses.
The problem is significant. Regulatory impediments have contributed to an economic stagnation that was estimated be $2 trillion. Unlike political promises of “shovel-ready” stimulus projects, the benefits from increased economic commerce will not cost taxpayers a dime. If streamlined, these private initiatives would have the potential to spur economic growth, create jobs and increase consumer welfare.
There are many other topics that do not cleanly fit into energy, health, tech, finance and transportation issues. Taxes and surcharges can be set excessively high, be discriminatory, generally unfair to some groups, lack transparency, be inefficient or result in multiple or duplicative charges.
In some instances, licensing can be used as a barrier to entry. For example, occupational licensing is used to establish worker standards and qualifications, but can also be used to restrict labor force participation, which could increase wages for existing workers, limit entry by new workers, and raise consumer prices. Certificates of necessity are used in many states to limit competitive entry.
Topics involving a myriad of other markets – manufacturing, legal, resource mining, government, public utilities and so on – may provide potential examples where regulations are harming economic progress and production, market entry barriers and higher consumer prices. These may service as future research topics.
“Obama’s Economic Recovery is Now $2.2 Trillion Below Average,” Investor’s Business Daily, July 29, 2016.