Regulation and Economic Growth: Applying Economic Theory to Public Policy

TLDR: Broughel et al. as mentioned in this paper provide a theoretical framework for understanding how regulations affect economic growth by reviewing what economists have learned about growth over the past 60 years and by describing the puzzles yet to be solved.

Abstract: Government regulation is a double-edged sword. By restricting the inputs—capital, labor, technology, and more—that can be used in the production process, regulation shapes the economy and, by extension, living standards today and in the future. Applied effectively, regulation can foster a thriving, competitive marketplace where innovation and technological progress flourish. Executed poorly, regulation can stifle creativity and learning and limit opportunities for all citizens. In this brief but authoritative work, James Broughel lays out a basic theoretical framework for understanding how regulations affect economic growth. He provides a useful starting point for researchers of regulation and growth by reviewing what economists have learned about growth over the past 60 years and by describing the puzzles yet to be solved. The book includes a unique classification system for distinguishing among the various “shocks” induced by regulation and tracking how these shocks translate into “effects” in terms of economic growth. It should prove helpful to academic researchers, advanced undergraduate and graduate students, policymakers, and anyone else who wishes to assess with greater precision the repercussions of the complex web of rules that governs our lives.