Report

The Economics of Regulatory Repeal and Six Case Studies

Nov 6, 2018 | Alan J. Krupnick, Arthur G. Fraas, Justine Huetteman, Isabel Echarte

Summary

Should regulations stay or should they go? RFF researchers conducted cost-benefit analyses of six regulations generating industry complaints.

Key Findings

  • For five out of the six rules analyzed, the benefits forgone outweigh the cost savings under a reasonable set of assumptions.
  • Prioritizing repeal using the preferred net benefits criterion yields very different rankings than prioritizing according to cost savings alone.
  • Better accounting for sunk cost and benefits as well as the degree of compliance is needed to improve repeal analyses.
  • Uncertainties in the benefits analyses need to be handled better and with an eye to making a future repeal analysis more meaningful.
  • Regulatory impact analyses should be seen as informative, not as a definitive decisionmaking tool.