Regulatory Reform 101: A Guide for the States

All states have administrative procedures in place for the purpose of ensuring that regulations achieve goals, are informed by factual evidence, and are not overly burdensome. Unfortunately, these procedures sometimes break down and need reforming. Broken regulatory procedures result in rules that address nonexistent problems, that impose costs out of proportion to the benefits produced, or that overlook simpler, lower-cost solutions that would achieve similar outcomes. Poor procedures also create incentives for the regulatory code to grow without limit, which can impede innovation and slow economic growth.

Regulatory process reforms come in two basic forms, depending on whether the intent of reformers is to design better regulations before rules are implemented, or whether their intent is to assess the success of regulations after they are finalized. Reforms related to reviewing regulations already in place are known as regulatory look-back reforms, and they encourage regulators to periodically review and update existing regulations. The goal is to identify and modify or repeal rules that are obsolete, inefficient, or otherwise ineffective, and to identify, learn from, and improve upon successful rules.

Changes to the process of creating regulations are known as ex ante regulatory process reforms. Here, the aim is to make policy more evidence-based and efficient, as well as to encourage regulators to be more responsive to the public. This essay covers both types of regulatory reform and attempts to provide a roadmap for states to use to ensure better, economically useful regulations.

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