Industry Regulation & the Performance of the American Economy [Paperback]

Paul W. MacAvoy (Author)

Book Description

ISBN-10: 0393961869 | ISBN-13: 978-0393961867 | Publication Date: March 17, 1992 | Edition: 1st

Regulation reached its zenith in the 1960s. The 1980s was the decade of deregulation. The 1990s afford us an important opportunity to assess what is left of regulation and its impact on the economy. And who better to do this than Paul W. MacAvoy, one of America's most respected experts on the economics of industry? Beginning with the Act to Regulate Commerce of 1887, Professor MacAvoy traces the rise of regulation over one hundred years to its sharp curtailment in the 1980s. Originally invoked as a means of controlling the prices set by monopolies, this policy tool found extended use in the last quarter-century to do everything from keeping down energy prices to protecting the health and safety of workers and the quality of the environment. In most cases regulation has been founded on the best of intentions, but as the deregulation of the airline, trucking, and railroad industries in the 1980s made clear there are other ways of achieving social objectives. It is thus useful to ask whether the remaining regulation is having its intended effects, as well as whether there are more effective ways of achieving those same objectives, including strict reliance on open and competitive markets. With this comprehensive study of the economywide effect of regulation, Paul MacAvoy considers just this issue. His analysis begins with price regulation, assessing its impact in terms of lost growth in output due to rigid prices and declining quality of service. He then does the same for health, safety, and environmental protection regulation, this time measuring the higher costs from regulatory standards against safer working conditions and better air quality. He finds that regulation is expensive,particularly when you consider that there are other ways to achieve both greater consumer welfare and a larger economy. In a concluding chapter, Professor MacAvoy looks at regulatory reform and finds plenty of room for further reductions in regulation.

Product Details

• Paperback: 148 pages
• Publisher: W. W. Norton & Company; 1st edition (March 17, 1992)
• Language: English
• ISBN-10: 0393961869
• ISBN-13: 978-0393961867
• Product Dimensions: 8.2 x 5.5 x 0.5 inches
• Shipping Weight: 7.4 ounces (View shipping rates and policies)
• Average Customer Review: 3.0 out of 5 stars  See all reviews (1 customer review)
• Amazon Best Sellers Rank: #3,493,043 in Books (See Top 100 in Books)

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Most Helpful Customer Reviews

1 of 1 people found the following review helpful:

3.0 out of 5 stars Should we regulate the amount of regulation?, August 26, 2000

By 

Mark Latta - See all my reviews

This review is from: Industry Regulation and the Performance of the American Economy (Hardcover)

Mr. MacAvoy presents an enlightening study of how regulation (specifically in the 60's, 70's, and 80's) has affected the GNP of our country. But, be warned, this is not your high school economics class.

Instead, it would be beneficial for the reader to have a very good grasp on economic principles, and some economic specifics such as rate of return, capitalization, and price ceilings. Not to say that it can't be read, pondered, and enjoyed without having a sound, college-level macroeconomics course; but it may be helpful.

Overall, Mr. MacAvoy presents a strong case for deregulation. It may be thought that regulation by OSHA, the EPA, and the Civil Aeronautics Board (now defunct) can save us from pollution, monopolistic pricing, and dangers in the workplace. This book shows how these organizations have not only failed on those objectives, but have adversely distorted the market and pulled down the economy in the process.

One complaint about this book is that it tends to be a bit dry. Fortunately, it is short.

Another complaint is that the edition I have (1992) is a bit dated. I would love to see an updated copy in print showing how regulation in the 1990's has affected the same areas that this book has covered (communications, railroad, airline, environment, workplace safety, etc.) Have we learned from past mistakes?

"Industry Regulation and the Performance of the American Economy" is an concise, economic analysis which shows how the ideals that we want to promote rarely meet up with the reality of regulation and performance. A worthwhile. if a bit tedious, read to anyone who either makes public policy or would like to influence public policy from an informed standpoint.