EconPapers    
Economics at your fingertips  
 

The Economics of Regulatory Tiering

William Brock and David Evans ()

RAND Journal of Economics, 1985, vol. 16, issue 3, 398-409

Abstract: Many regulations impose lighter requirements on smaller firms than on larger firms. Such differential treatment is known as tiering. This article presents a framework for analyzing tiering. It assumes that regulators use taxes to reduce negative externalities, that the collection of taxes imposes administrative costs on the taxed firm and the regulatory agency, and that firm heterogeneity arises because firms have differential access to a scarce factor. The scarce factor is taken as managerial ability, although this identity is not essential for any of the results obtained. The article shows that when there are scale economies in regulatory compliance, tiered regulations may be Pareto-superior to untiered regulations under certain circumstances. It then compares existing tiering schemes with Pareto-efficient tiering schemes and suggests possible improvements in existing tiering schemes.

Date: 1985
References: Add references at CitEc
Citations: View citations in EconPapers (16) Track citations by RSS feed

Downloads: (external link)
http://links.jstor.org/sici?sici=0741-6261%2819852 ... O%3B2-L&origin=repec full text (application/pdf)
Access to full text is restricted to JSTOR subscribers. See http://www.jstor.org for details.

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:rje:randje:v:16:y:1985:i:autumn:p:398-409

Ordering information: This journal article can be ordered from
https://editorialexp ... i-bin/rje_online.cgi

Access Statistics for this article

More articles in RAND Journal of Economics from The RAND Corporation
Bibliographic data for series maintained by ().

 
Page updated 2021-08-28
Handle: RePEc:rje:randje:v:16:y:1985:i:autumn:p:398-409