Direct Government Regulation Research Articles

Health Care Reform and the Constitutional Limits on Private Accreditation as an Alternative to Direct Government Regulation

My goals are modest. First, I will draw upon my personal experience during six-and-a-half years at the Department of Health and Human Services (HHS) to make a few cultural observations about the agency in an effort to suggest why different parts of it approach private accreditation in different ways. Second, I will discuss some of the possible limitations on the use of private accreditation in the health care area, including the private delegation doctrine, a dormant area of constitutional law so treacherous that it seems to have appeal to both former Justice Brennan and Chief Justice Rehnquist as a vehicle for judicial activism.

Health care technologies in The Netherlands. Assessment and policy.

This article argues that while health care and government authorities in the Netherlands in the last decades have attempted to rationalize the diffusion of medical technology, much work remains to be done. The authors contend that though a mix of direct government regulation and economic incentives will be needed, regulation by incentive is more effective than regulation by directive in achieving cost effective use of technology. Generally, bureaucratic structures provide only limited opportunities for tight control of the diffusion of medical technologies. The article offers possible future strategies for directing the adoption and use of medical technologies and stresses the importance of reliable information culled from comprehensive technology assessments.

Marketable Zoning: A Cure for the Zoning System

Abstract In 1968, Professor J.H. Dales proposed that, instead of direct government regulation of air and water pollution, the government should simply create a market for the sale of rights to pollute the air and the water? By the 1980s, this view had received much acceptance; the Environmental Protection Agency, for example, was showing strong interest and experimenting with creating new markets to pollution rights. Similar proposals have also been made for the creation of private markets for ocean fishing, broadcast licenses, ground-water, and other natural resources. In each case, the ability to use these resources is now allocated by government through a regulatory permit system. But also, in each case, it is proposed that a private market would perform this allocative role more efficiently and effectively. These examples are part of a much broader national—indeed worldwide—trend toward reexamining the relative economic roles of government and the private market, and considering whether the market mec...

Antitrust Issues in the Food Industries

The United States is unique among countries of the world for its strong reliance on antitrust as its main public policy vehicle for regulating business. In the U.S. economy, the market is extant over almost 90% of the production of goods and services, while direct government regulation encompasses a little more than a tenth (Sherer, p. 519). Aside from government regulations to protect the environment, worker safety, and a number of other aspects of company conduct, the free market sector is essentially self-regulating with the government acting only infrequently and very selectively as a policeman to ensure that fair and open competition prevails. The history of antitrust has been mostly one of public indifference. However, the last five years, and especially this election year, have seen at least a minor ground swell of interest develop. This interest reflects frustration over the prolonged period during which the economy has experienced simultaneously high inflation and high unemployment rates. In 1971, the perceived failure of markets to operate without uncontrollable inflation and high employment saw the Congress and the most laissez faire national administration in two generations of American politics opt for a rigid system of price controls. The vestiges of that system lasted until April 1974. Abhorrence of regulation by the administration together with the unsure success of its price control program saw a major increase in the rhetoric supporting strong antitrust enforcement to make markets more competitive and self-regulating. The wave of food price increases that began in 1972 caused food to be a focal point of the public concern. Both the Federal Trade Commission (FTC) and the Department of Justice responded to the concern by increasing dramatically the amount of their resources spent on investigations involving food processing and retailing companies. In 1975, the FTC spent about a fifth of its total antitrust resources in the area. Because of this high level of activity, it is particularly appropriate that the American Agricultural Economics Association should consider the antitrust policy in agriculture. I discuss antitrust issues relating to the food marketing industries. In so doing, I limit myself to economic issues even though many people would argue, and correctly so, that the antitrust laws are deeply rooted in social philosophy. In limiting the discussion to antitrust issues relating to competitive efficiency, I focus on the potential competitive problems identified in the economic literature describing the structure and performance trends in the food manufacturing industries and food retailing industry and on the group of issues that are perceived by antitrust agencies in their enforcement activities. The latter differ from the former because of operational limitations imposed on the agencies by the antitrust statutes and court interpretations and by the attitudes and philosophies of agency administrators and staff.

Relations Between Public Policy Issues and Economies of Scale

Notions of economies of scale have always played a unique role in public policy formation, although most often implicity rather than explicitly. It is the cornerstone of the theory of natural monopoly and provides the primary justification for direct government regulation of telecommunications common carriers. The relations between the technical economic concept of economies of scale and current public policy issues in telecommunications are examined. The relationship between economies of scale and the traditional approach to regulation as a basis for understanding current policy conflicts between federal and state regulators is discussed. The theoretical economic concept of economies of scale, in contrast to concepts of short-run capacity utilization, economies of specialization, and economies of technological change is developed. The importance of time, uncertainty, and market characteristics in the measurement of scale effects is emphasized. Finally, the implications of economies of scale for current public policy issues in telecommunications such as the role of competition, cream skimming, and discriminatory rate reductions in response to competition are addressed.