Analyzing Regulatory Failure: Mismatches, Less Restrictive Alternatives, and Reform

Professor Breyer presents here a framework for analysis and reform of economic regulation. The framework consists of three basic elements: justifications for regulation, modes of classical regulation and the problems they entail, and "less restrictive alternatives" to regulation, including taxation and disclosure. Using contemporary regulatory programs as examples, Professor Breyer argues that many such programs are ill designed to meet their objectives, and that the problems inherent in such regulatory regimes are severe. Finally, he briefly sketches how one might, as a practical matter, go about achieving reform, citing as an example the recent change in airline regulation.