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Full-Text Articles in Law and Economics
Incentives And Ideology, James Kwak
Incentives And Ideology, James Kwak
Faculty Articles and Papers
This is a response to Adam Levitin's article, The Politics of Financial Regulation and the Regulation of Financial Politics: A Review Essay, 127 Harv. L. Rev. 1991 (2014). Levitin discusses various reasons for regulatory capture and highlights several potential solutions that aim to change the political governance of financial regulation. In this response, I highlight the importance of ideology (in this case, the ideology of free financial markets) in producing regulatory outcomes that are good for industry, and therefore the need for solutions that mitigate ideological capture.
The Empirical Roots Of The 'Regulatory Reform' Movement: A Critical Appraisal, Richard Parker
The Empirical Roots Of The 'Regulatory Reform' Movement: A Critical Appraisal, Richard Parker
Faculty Articles and Papers
Over the past few years the debate over the economic rationality of health, safety and environmental regulation has morphed into a sustained controversy over the tests and methods by which that rationality is judged. Critics have argued that the main regulatory scorecards which comprise much of the empirical foundation for the regulatory reform movement are fundamentally flawed because they: alter agency estimates of future costs and benefits; disregard most uncertainties; and misrepresent ex ante guesses as the costs and benefits of regulation. They also zero out whole categories of benefits that cannot be quantified and/or monetized even when the benefits …
Grading The Government, Richard Parker
Grading The Government, Richard Parker
Faculty Articles and Papers
For over a decade, scathing critiques of government have been fueled by a group of studies called regulatory scorecards, which purport to show that the costs of many government regulations vastly outweigh their benefits. One widely-cited study by John Morrall, an OMB economist, claims that government regulations cost up to $72 billion per life saved. Another study, co-authored by Bush's regulatory czar, John Graham, claims that over 60,000 people lose their lives each year due to irrational government regulation. A third group of scorecards - compiled by Robert Hahn of the AEI-Brookings Joint Center for Regulatory Studies - claims that …