Regulations should further their primary mission. Yet, many regulations designed to reduce health, safety and environmental risks end up increasing the risk of injury and death. A lack of cost-benefit analysis is often blamed for the unintended consequences resulting in an increase in these risks. There are several reasons why regulations can lead to increased risks. A regulation can lead to behavioural responses that offset its intended impact.
The act of complying with regulations may impose risks.
The cost of compliance with regulations may impose risks.
Research has shown a link between a society's wealth and longevity. To the degree that costly regulations reduce national income, they result in lives lost:
Annually $200 billion is spent on federal environmental, health and safety regulations in the U.S.A.
If that spending were allocated to those regulations with the highest benefit, 60,000 lives per year could be saved.
Each $15 million in reduced U.S. national income is associated with one premature death; thus regulations that have a negative economic impact can cost more lives than the number saved by the regulations.
The authors limited their examination to only the 24 regulations where 90 percent of benefits were mortality related. Of the regulations examined, those with the largest induced mortality were disproportionately those of the Environmental Protection Agency. The EPA rules that raised mortality risk were those designed to reduce exposure to carcinogens in the environment.
Source: Robert W. Hahn, Randall W. Lutter and W. Kip Viscusi, Do Federal Regulations Reduce Mortality?, AEI-Brookings Joint Center for Regulatory Studies, November 2000.
For text http://www.aei.brookings.org/publications/books/hlv.pdf
For more on Improving the Regulatory Process http://www.ncpa.org/pd/regulat/reg-8.html
Publish date: 05 March 2001
The views expressed in the article are the author’s and are not necessarily shared by the members of the Foundation.