No CrossRef data available.
Article contents
Three Misconceptions about Federal Regulation
Published online by Cambridge University Press: 04 October 2022
Abstract
Three common misconceptions persist about federal regulations. The first misconception is that most new regulations concern the environment, but in fact, only a small minority of regulatory flows are environmental. The second misconception is that regulators offer reasonable justifications and quantitative evidence for the majority of regulations. However, quantitative estimates rarely appear in published rules, negating the impression given by executive orders and Office of Management and Budget guidance, which require cost-benefit analysis (CBA) and clearly articulate sound economic principles for conducting CBA. Environmental rules have relatively higher-quality CBAs, at least by the standards of other federal rules. The third misconception, which is particularly relevant to the historic regulations promulgated during the COVID-19 pandemic, is that regulatory costs are primarily clerical, rather than opportunity or resource costs.
- Type
- Article
- Information
- Copyright
- © The Author(s), 2022. Published by Cambridge University Press on behalf of the Society for Benefit-Cost Analysis
References
Alpert, Abby, Powell, David, and Pacula, Rosalie Liccardo. 2018. “Supply-Side Drug Policy in the Presence of Substitutes: Evidence from the Introduction of Abuse-Deterrent Opioids.” American Economic Journal: Economic Policy, 10(4): 1–35.Google ScholarPubMed
Al-Ubaydli, Omar, and McLaughlin, Patrick A.. 2017. “RegData: A Numerical Database on Industry-Specific Regulations for All United States Industries and Federal Regulations, 1997–2012.” Regulation & Governance, 11(1): 109–123.Google Scholar
Belcore, Jamie, and Ellig, Jerry. 2008. “Homeland Security and Regulatory Analysis: Are We Safe Yet?” Rutgers Law Journal, 40(1): 1–96.Google Scholar
Bonnie, Richard J., Ford, Morgan A., and Phillips, Jonathan K. (Eds.) 2017. Pain Management and the Opioid Epidemic: Balancing Societal and Individual Benefits and Risks of Prescription Opioid Use. Washington, DC: National Academies Press: 6.CrossRefGoogle Scholar
Broughel, James. 2018. “More Information Needed on the Benefits and Costs of Regulations.” The Bridge.Google Scholar
Centers for Medicare and Medicaid Services, Medicare Program. April 12, 2012. Changes to the Medicare Advantage and the Medicare Prescription Drug Benefit Programs for Contract Year 2013 and Other Changes, 77 Fed. Reg. 22071, 22072.Google Scholar
Congressional Budget Office. May 2018. Federal Subsidies for Health Insurance Coverage for People under Age 65: 2018 to 2028.Google Scholar
Congressional Research Service. September 2019. “Counting Regulations: An Overview of Rulemaking, Types of Federal Regulations, and Pages in the Federal Register.” CRS Report R43056.Google Scholar
Council of Economic Advisers. June 2019b. The Economic Effects of Federal Deregulation since January 2017: An Interim Report.Google Scholar
Council of Economic Advisers. December 2020. Estimating the Value of Deregulating Automobile Manufacturing Using Market Prices for Emissions Credits.Google Scholar
Crain, W. Mark. September 2005. The Impact of Regulatory Costs on Small Firms. SBA Office of Advocacy.Google Scholar
Crews, Clyde Wayne. November 17, 2015. “Less Than 1 Percent of Federal Regulations Get Cost-Benefit Analysis,” Competitive Enterprise Institute. Available at https://cei.org/blog/less-1-percent-federal-regulations-get-cost-benefit-analysis accessed March 10, 2020.Google Scholar
Crews, Clyde Wayne. September 2017. “What’s the Difference between ‘Major,’ ‘Significant,’ and All Those Other Federal Rule Categories?” Competitive Enterprise Institute Issue Analysis No. 8.Google Scholar
Department of Health and Human Services. January 31, 2019. “Trump Administration Proposes to Lower Drug Costs by Targeting Backdoor Rebates and Encouraging Direct Discounts to Patients,” News Release. Available at https://www.hhs.gov/about/news/2019/01/31/trump-administration-proposes-to-lower-drug-costs-by-targeting-backdoor-rebates-and-encouraging-direct-discounts-to-patients.html accessed March 10, 2020.Google Scholar
Department of Health and Human Services, Fraud and Abuse. February 6, 2019. Removal of Safe Harbor Protection for Rebates Involving Prescription Pharmaceuticals and Creation of New Safe Harbor Protection for Certain Point-of-Sale Reductions in Price on Prescription Pharmaceuticals and Certain Pharmacy Benefit Manager Service Fees, 84 Fed. Reg. 2340.Google Scholar
Department of Labor, Wage and Hour Division. May 23, 2016. Defining and Delimiting the Exemptions for Executive, Administrative, Professional, Outside Sales and Computer Employees, 81 Fed. Reg. 32391.Google Scholar
Department of Transportation, Federal Railroad Administration. August 3, 2011, “Positive Train Control Systems,” Regulatory Impact Analysis.Google Scholar
Dudley, Susan E. 2012. “Perpetuating Puffery: An Analysis of the Composition of OMB’s Reported Benefits of Regulation.” Business Economics, 47(3): 165–176.Google Scholar
Dudley, Susan E. Summer 2013. “OMB’s Reported Benefits of Regulation: Too Good to Be True?” In Regulation: Cato Institute 26–30.Google Scholar
Dudley, Susan E., and Mannix, Brian F.. 2018. “Improving Regulatory Benefit-Cost Analysis.” Journal of Law and Politics, 34(1): 1–20.Google Scholar
Ellig, Jerry. July 2016. “Evaluating the Quality and Use of Regulatory Impact Analysis: The Mercatus Center’s Regulatory Report Card, 2008–2013.” Mercatus Working Paper, Mercatus Center at George Mason University, Arlington, VA.Google Scholar
Ellig, Jerry, and Horney, Michael. 2016. “Preventing a Regulatory Train Wreck: Mandated Regulation and the Cautionary Tale of Positive Train Control.” Mercatus Working Paper, Mercatus Center at George Mason University, Arlington, VA, June 2016, 6.Google Scholar
Ellig, Jerry, and McLaughlin, Patrick A.. 2012. “The Quality and Use of Regulatory Impact Analysis in 2008.” Risk Analysis, 32(5): 855–880.CrossRefGoogle Scholar
Ellig, Jerry, and Peirce, Hester. 2014. “SEC Regulatory Analysis: A Long Way to Go and a Short Time to Get There.” Brooklyn Journal of Corporate, Financial & Commercial Law, 8(2): 410–411.Google Scholar
Ellig, Jerry, and Williams, Richard. 2014. “FDA’s Animal Food Regulation is for the Birds.” Regulation, 37(2): 54–61.Google Scholar
Evans, William N., Ethan, M. J. Lieber, and Power, Patrick. 2019. “How the Reformulation of OxyContin Ignited the Heroin Epidemic.” Review of Economics and Statistics, 101(1): 1–15.Google Scholar
Febrizio, Mark, and Warren, Melinda. July 2020. “Regulators’ Budget: Overall Spending and Staffing Remain Stable,” Regulators’ Budget Report 42, Weidenbaum Center on the Economy, Government, and Public Policy and The George Washington University Regulatory Studies Center.Google Scholar
Federal Reserve Bank of St. Louis. March 9, 2020. “Household Estimates (TTLHHM156N)” (Dataset). Available at https://fred.stlouisfed.org/series/TTLHHM156N accessed March 9, 2020.Google Scholar
Food and Drug Administration. December 30, 2009. “NDA 22-272 OxyContin Division Director Summary Review for Regulatory Action.” 10 (emphasis added). Available at https://www.accessdata.fda.gov/drugsatfda_docs/nda/2010/022272s000MedR.pdf.Google Scholar
Food and Drug Administration. September 15, 2015a. “Current Good Manufacturing Practice, Hazard Analysis and Risk-Based Preventive Controls for Food for Animals,” Final Regulatory Impact Analysis, 31–51.Google Scholar
Food and Drug Administration. September 15, 2015b. Current Good Manufacturing Practice and Hazard Analysis and Risk-Based Preventive Controls for Food for Animals, 80 Fed. Reg. 56170.Google Scholar
Food and Drug Administration. July 11, 2017. “Data and Methods for Evaluating the Impact of Opioid Formulations with Properties Designed to Deter Abuse in the Postmarket Setting: A Scientific Discussion of Present and Future Capabilities,” Docket No. FDA-2017-N-2903, 182. Available at https://www.fda.gov/media/107603/download.Google Scholar
Food and Drug Administration. 2017 “Data and Methods for Evaluating the Impact of Opioid Formulations,” 184.Google Scholar
Foran, Clare, and National Journal. 2015. “Elizabeth Warren Slams Big Oil, Says Major Companies Profit from Pollution.” The Atlantic, April 13, 2015.Google Scholar
Fraas, Art, and Lutter, Randall. 2011. “The Challenges of Improving the Economic Analysis of Pending Regulations: The Experience of OMB Circular A-4.” Annual Review of Resource Economics, 3(1): 71–85.CrossRefGoogle Scholar
Government Accountability Office. April 1997. Air Pollution: Information Contained in EPA’s Regulatory Impact Analyses Can Be Made Clearer.Google Scholar
Government Accountability Office. May 1998. Regulatory Reform: Agencies Could Improve Development, Documentation, and Clarity of Regulatory Economic Analyses.Google Scholar
Hahn, Robert W., Burnett, Jason K., Chan, Yee-Ho I., Mader, Elizabeth A., and Moyle, Petrea R.. 2001. “Assessing Regulatory Impact Analyses: The Failure of Agencies to Comply with Executive Order 12,866.” Harvard Journal of Law and Public Policy, 23(3): 859–871.Google Scholar
Hahn, Robert W., and Dudley, Patrick. 2007. “How Well Does the Government Do Cost-Benefit Analysis?.” Review of Environmental Economics and Policy, 1(2): 192–211.Google Scholar
Hahn, Robert W., and Hird, John A.. 1990. “The Costs and Benefits of Regulation: Review and Synthesis.” Yale Journal on Regulation, 8(233): 233–278.Google Scholar
Hahn, Robert W., and Litan, Robert. 2005. “Counting Regulatory Benefits and Costs: Lessons for the U.S. and Europe.” Journal of International Economic Law, 8(2): 473–508.Google Scholar
Hahn, Robert W., Lutter, Randall W., and Viscusi, W. Kip. 2000. Do Federal Regulations Reduce Mortality? Washington, DC: AEI-Brookings Joint Center for Regulatory Studies.Google Scholar
Hahn, Robert W., and Tetlock, Paul C.. 2008. “Has Economic Analysis Improved Regulatory Decisions?” Journal of Economic Perspectives, 22(1): 67–84.Google Scholar
Harrington, Winston, Morgenstern, Richard D., and Nelson, Peter. 2000. “On the Accuracy of Regulatory Cost Estimates.” Journal of Policy Analysis and Management, 19(2): 297–322.3.0.CO;2-X>CrossRefGoogle Scholar
Hopkins, Thomas D. 1998. “Regulatory Costs in Profile.” Policy Sciences, 31(4): 301–320.CrossRefGoogle Scholar
Krugman, Paul. 2019. “Donald Trump is Trying to Kill You.” New York Times, April 4, 2019.Google Scholar
Maust, Donovan T., Allison Lin, Lewei, and Goldstick, Jason E.. 2020 “Association of Medicare Part D Benzodiazepine Coverage Expansion with Changes in Fall-Related Injuries and Overdoses among Medicare Advantage Beneficiaries.” JAMA Network Open, 3(4): e202051.Google ScholarPubMed
McLaughlin, Patrick A., Ellig, Jerry, and Wilt, Michael. 2017. “Comprehensive Regulatory Reform.” Mercatus Policy Primer, Mercatus Center at George Mason University, Arlington, VA.Google Scholar
McLaughlin, Patrick A., and Sherouse, Oliver. 2018. RegData US 3.1 Annual (Dataset), QuantGov, Mercatus Center at George Mason University, Arlington, VA. Available at https://quantgov.org/regdata-us/.Google Scholar
Mulligan, Casey B. February 2020a. “Prices and Federal Policies in Opioid Markets.” NBER Working Paper No. 26812, National Bureau of Economic Research, Cambridge, MA.Google Scholar
Mulligan, Casey B. 2020b. You’re Hired!: Untold Successes and Failures of a Populist President. Washington, DC: Republic Book Publishers.Google Scholar
Mulligan, C. B. (2021). Economic Activity and the Value of Medical Innovation during a Pandemic. Journal of Benefit-Cost Analysis, 12(3), 420–440. https://doi.org/10.1017/bca.2021.5CrossRefGoogle Scholar
Mulligan, Casey B. 2022. “Peltzman Revisited: Quantifying 21st Century Opportunity Costs of FDA Regulation.” Journal of Law and Economics, to appear.Google Scholar
Nielson, Aaron. 2014. “In Defense of Formal Rulemaking.” Ohio State Law Journal, 75(2): 237–292.Google Scholar
Office of Management and Budget. August 16, 1999, The Paperwork Reduction Act of 1995: Implementing Guidance.Google Scholar
Office of Management and Budget. 2016. “Office of Information and Regulatory Affairs.” Information Collection Budget of the United States Government.Google Scholar
Office of Management and Budget. April 5, 2017. “Guidance Implementing Executive Order 13771, Titled ‘Reducing Regulation and Controlling Regulatory Costs’.” M-17-21, Executive Office of the President, Washington, DC: 6.Google Scholar
Office of Management and Budget. December 6, 2019. “Marginal Excess Tax Burden as a Potential Cost under EO 13771,” Regulations.gov. Available at https://www.regulations.gov/document?D=OMB-2017-0002-0055.Google Scholar
Office of Management and Budget. 2017. “Guidance Implementing Executive Order 13771”: 6.Google Scholar
Office of Management and Budget. 2019. “Marginal Excess Tax Burden as a Potential Cost under EO 13771.”Google Scholar
Office of Management and Budget, Office of Information and Regulatory Affairs. 2017. 2017 Draft Report to Congress on the Benefits and Costs of Federal Regulations and Agency Compliance with the Unfunded Mandates Reform Act.Google Scholar
Our World in Data. 2017. Productivity per Hour Worked, 1970 to 2017. Available at https://ourworldindata.org/grapher/labor-productivity-per-hour-pennworldtable (accessed May 8, 2020).Google Scholar
Schedules of Controlled Substances. October 30, 2019. Placement of FUB-AMB in Schedule 1, 84 Fed. Reg. 58090, 58094.Google Scholar
Selin, Jennifer L., and Lewis, David E.. 2018. Sourcebook of United States Executive Agencies, 2nd ed: 12. Washington, DC: Administrative Conference of the United States.Google Scholar
United Nations Office on Drugs and Crime. September 18, 2017. “Non-Medical Use of Benzodiazepines: A Growing Threat to Public Health?” Global SMART Update.Google Scholar
White House. February 2012. Economic Report of the President Together with the Annual Report of the Council of Economic Advisers.Google Scholar
White House. March 2019. Economic Report of the President Together with the Annual Report of the Council of Economic Advisers.Google Scholar
White House. February 2020. Economic Report of the President Together with the Annual Report of the Council of Economic Advisers.Google Scholar