New Database Quantifies Economic Impact of Federal Regulations

New Database Quantifies Economic Impact of Federal Regulations
September 2, 2014

Federal regulations have proliferated since the 1970s, when federal laws created several major regulatory agencies such as the Environmental Protection Agency (EPA), the Department of Housing and Urban Development (HUD), and the Department of Energy (DOE). 

In fact, the total number of pages published in the annual Code of Federal Regulations—the set of books in which all federal regulations in effect in each year are published—has increased from 54,843 in 1970 to 175,496 in 2013. 

Government, the Great Obstructer

Is it possible to understand fully how this accumulation of regulation affects our economy? For example, do regulations lower employment levels? Do workplace safety regulations actually lead to workplace safety? And why does the number of regulations keep rising? 

A new publicly searchable database, RegData 2.0, was created to help answer these types of questions and more.

RegData 2.0, which I created with George Mason University professor Omar Al-Ubaydli, collects statistics about federal regulation. These statistics include simple, broad measures of regulation, such as word counts, and nuanced and precise measures, such as restriction counts.

A unique feature of RegData 2.0 is that it offers a measure of how many restrictions the various regulators create. In 2012, for example, the top 10 regulators, those agencies that printed the most restrictions in 2012’s regulatory code, accounted for about 31 percent of all restrictions, with EPA’s Air Programs leading the way.

Economic Shackles

RegData also measures the degree to which regulators target various sectors of the economy. To do this, we measure the number of times key words related to specific economic sectors are found in regulatory texts. 

This allows us to create an industry-specific index of how much regulation targeting different sectors of the economy has grown over time. For example, regulation of the manufacturing sector has grown by 51 percent since 1997.

With hundreds of regulator-specific and thousands of industry-specific options to choose from, RegData is an effective tool to help inform many types of policy and economic debates, for activists and policymakers alike.

Patrick A. McLaughlin, Ph.D., (pmclaughlin@mercatus.gmu.edu) is a senior research fellow at the Mercatus Center at George Mason University.