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Bylund's Central Arguments
In his 2016 publication entitled The Seen, Unseen, and Unrealized: How Regulations Affect Our Daily Lives, Dr. Per L. Bylund provides nuanced perspective on government regulation and outlines the fallacies that many misconceptions surrounding economic growth sit on.
Expansion on Bylund's Writings
I found Bylund's work very interesting, as I had not been introduced and walked through many of these ideas since I am somewhat of an outsider in the world of economics. The broken window analogy of Bastiat is brilliant, as it accurately depicts the ripple effects of one transaction, but also provides the explanation that the world may be better off without the transactions... and the initial broken window. Can the same thing be said of regulation though? It is a similar dilemma, as we are unable to correctly assess what would have happened if certain policies were not implemented. Not to get too much into the realm of multiverse theory in physics, but there is no other identical economy without such policy. We lack a control variable to compare to. It is another case of Bylund's "the unseen".
Does this mean that we cannot determine the good or bad government intervention? I would argue not necessarily. If we look back to Bylund's definition of ineffective regulation: "Ineffective regulation would be policy that has little real effect and therefore does not effectuate the level of change that was intended" (Bylund, 102). We must be careful to not conflate effective, or initiating change in society with such qualities as good or bad. Bylund continues on to describe two mechanisms of regulation: added cost and prohibition. Both courses of actions have added costs and limit the market choices for consumers. Again though, we cannot simplify and easily categorize these added costs into a category of good or bad. For instance, clean energy awards from the government may be viewed as a negative thing adding costs for cooperation's that are not as environmentally aligned. This may be viewed as either a good or bad thing depending on which side of the issue one aligns with, but it definitely limits the options for consumers and raises costs. Though, I am guarding against oversimplification... let us just say that is a bad conclusion for the sake of the hypothetical. But what about the Food and Drug Administration regulating drug manufacturers, doing rigorous tests on such biological compounds to ensure their efficacy and safety. This regulatory agency causes pharmaceutical companies to pay millions if not billions of dollars and maybe years in the approval stage, thus having the same overall effect at the market level -- less choices, higher prices (Price buffers include insurance companies and the availability of generics after patents expire). Would one want to take a drug that has not been approved by a third party independent of the manufacturer for the added benefit of a lower market cost? This may be ill advised, but I suppose this decision comes down to personal values as do many others in the realm of economic policy and how much faith you have in the pharmaceutical industry to accurately report their data.
Ultimately, the same ends of regulatory policies can be viewed either as positive or negative based on personal circumstances. Providing blanket statements over such issues lacks nuance and does not account for individual perspectives, so we must be careful in reaching such conclusions.
