The Economist has a nice piece about countercyclical regulatory policy here. The piece ends with:
Just as fiscal and monetary policy vary according to the economic cycle, so perhaps should regulatory policy: lighter when unemployment is high, heavier when it is low. The economics of incorporating employment considerations into regulatory policy is in its infancy. Mr Sunstein calls it a “frontiers question”. Given the sorry state of America’s job market, it is worth answering.
[...] Mandel, chief economic strategist from the…ugh…dare I say it, Progressive Policy Institute, has proposed a rather intriguing idea that might just warm the cockles of little conservative hearts. Something he calls countercyclical [...]
"The Rebalancing Of The California Economy: How Internet/Tech Jobs Are Spreading Across The State", Progressive Policy Institute, May 2013
"Data, Trade, and Growth" (working paper), Progressive Policy Institute, updated May 2013
"Regulatory Improvement Commission: A Politically-Viable Approach to U.S. Regulatory Reform", (with Diana Carew), Progressive Policy Institute, May 2013.
"Student Debt Investment Fund (SDIF): A Preliminary Proposal for Addressing the Student Debt Crisis", (with Diana Carew and Jason Gold) Progressive Policy Institute, March 2013.
"The Geography of the App Economy"(with Judy Scherer), South Mountain Economics LLC for CTIA, October 2012.
"Beyond Goods and Services: The (Unmeasured) Rise of the Data-Driven Economy" Progressive Policy Institute, October 2012.
"Manufacturing in the App Economy:How Many Jobs Should We Aim For" (with Diana Carew), Progressive Policy Institute, May 2012.
"Hidden Toll:Imports and Job Loss Since 2007" (with Diana Carew), Progressive Policy Institute, March 2012.
"Measuring the Real Impact of Imports on Jobs" (with Diana Carew), Progressive Policy Institute, March 2012.
"Where the Jobs are: The App Economy" South Mountain Economics LLC (for Technet) February 2012.
"Scale and Innovation in Today's Economy," Progressive Policy Institute, December 2012.
Blog at WordPress.com. · Theme: Modern News by StudioPress.
While a nice idea, it runs counter to reality. When the economy is expanding the pressure will be keep it expanding and prevent any interference in it, and when the economy is shrinking the pressure will be to examine its shortcomings. It is just another version of the bezel. We probably shouldn’t even consider the effects of regulation on the economy but the effects of the economy on regulation. In any event, times of regress are much shorter than times of progress so any effect would be very limited.
Given the tremendous amount of cash held by major corporations, they can afford the manpower to conform to regulations, and the job of regulator is as legitimate as any other. I just want to point out that there are arguments on both sides of the question of regulation’s relationship to job creation.