Arbejdspapir 72: The Baumol effect and the growth of Leviathan
One of the most striking features of the 20th century is the massive growth of government in Western style democratic countries.
Udgivet d.
9. marts 2020 - 11:20
English
The number of words in Danish laws and regulations grew by 100,000 words in 2019, equivalent to 0.5 per cent. Since 1989, the density of legislation has grown by 13.7 million words, corresponding to 189 per cent – almost a threefold increase. This stifles economic growth, and that is the reason why politicians should force themselves to bring down the number of regulations by establishing a regulation ceiling.
According to Jonas Herby, the rise in the density of legislation is a problem for society.
”We know from international surveys and literature that a rise in the quantity of regulation in a society is damaging to the ability to generate growth. Regulation is simply in the way of citizens and businesses helping each other in the best possible way,” he says.
There are several ways to hamper the development:
”I recommend that the politicians introduce a regulation ceiling, meaning that the politicians need to get rid of one rule every time they introduce a new one. This will force politicians and officials to prioritize regulation, just as they are forced to make priorities within the government budget,” he says.
One of the most striking features of the 20th century is the massive growth of government in Western style democratic countries.