Administrative Simplification and Economic Growth: A Cross Country Empirical Study

Kevin Poel, Wim Marneffe, Samantha Bielen, Bas van Aarle and Lode Vereeck

Journal of Business Administration Research, 2014, vol. 3, issue 1, 45-58

Abstract: Administrative burdens stemming from regulations are a worldwide cause of concern for policy-makers. Reducing administrative burdens has become an important policy objective in economic growth strategies for many governments. The European Commission set out a policy goal of reducing administrative burdens by 25% by 2012, although the literature provides limited evidence of its impact. Therefore, this paper examines the impact of administrative burdens on growth by using 6 business regulation variables for a panel of 182 countries. The results from the fixed effect regression analysis suggest that reducing administrative burdens in certain policy areas spurs economic growth. In particular, reducing burdens concerning start-ups and paying taxes enhances growth significantly. Furthermore, using a panel of 26 European countries, our results suggest that reducing the administrative burdens by 25% has a positive effect on growth of 1.62 % in the European Union.

Date: 2014
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Persistent link: https://EconPapers.repec.org/RePEc:jfr:jbar11:v:3:y:2014:i:1:p:45-58

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