A bureaucratic theory of regulation

Richard McKenzie and Hugh Macaulay

Public Choice, 1980, vol. 35, issue 3, 297-313

Abstract: Not all modern regulation is explained by existing regulatory theories. A central purpose of this paper has been to demonstrate how and to what extent regulation of the private sector benefits advocates of growth in the public sector. A basic conclusion of the analysis has been that government-inspired private monopolies and the cost of regulation imposed on the private sector increase the price of goods and services in the private sector. However, at the same time prices of private goods and services go up, the relative prices of public goods and services go down, inducing political support for an expanded public sector. A secondary purpose of this paper has been to demonstrate that for the size maximizing bureaucracy which must incur cost in promulgating and enforcing private sector regulations, there is some optimum limit to the number of cartels that are formed and the amount of regulatory cost that is imposed on the private sector. The analysis may explain much of the adjustment in the extent of current regulation: that is, the bureaucracy, through the adjustment and re-adjustments of the scope and cost of regulation, is seeking out its maximum size. Copyright Martinus Nijhoff Publishers 1980

Date: 1980
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

Downloads: (external link)
http://hdl.handle.net/10.1007/BF00124443 (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:kap:pubcho:v:35:y:1980:i:3:p:297-313

Ordering information: This journal article can be ordered from
http://www.springer. ... ce/journal/11127/PS2

DOI: 10.1007/BF00124443

Access Statistics for this article

Public Choice is currently edited by WIlliam F. Shughart II

More articles in Public Choice from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().