Costs of Regulation

Benefits of Regulation

concentrated

dispersed

concentrated

fights over specific kinds of regulation (e.g. RR freight rate regulation or telecommunications, or wage bargaining in public sector). Both sides can easily mobilize

client politics (the only case in which olsonian collective action should work)

e.g. import restrictions, lobbying for tax breaks, lobbying for targeted funds

dispersed

entrepreneurial politics (class action suits against concentrated interests. What benefit to lawyer?)

restricting tobacco sales; tax cuts in general?

majoritarian politics (pure appeals to public goods?)

public smoking bans

Production processes:

are visible to outside observer

are invisible to observer

Agency Outputs are

Easily measured

production organization (tax system) simple repetitive stable tasks; specialized skills

craft organization (Auditors, Attorney General) application of general sets of skills to unique tasks, but with stable, similar outcomes

procedural organizations (military) specialized skills; stable tasks, but unique outcomes.

coping organization

(central govts policy units) application of generic skills to unique tasks, but outcomes can=t be evaluated in absence of alternatives