Consumer product safety regulation

While it is still too early to evaluate con- clusively the recent wave of consumer product safety regulation, the evidence thus far indicates that serious resource mis- allocation is taking place and is likely to continue. The regulators of product safety tend to rely solely on direct controls (product bans and standards) and to be concerned with the benefits only, as measured in the number of lives saved and accidents avoided. They ignore, often in- tentionally, the costs of their controls. Un- less this "safety imperative" approach to regulation is changed, the problems of resource misallocation will multiply over time as regulatory controls are extended to several additional product classes.

Duke Scholars

Author Henry G. Grabowski Economics