De-Regulate to Save Lives

Posted by: on Nov 25, 2011 | 4 Comments

It is a principle in economics that if prices of a product are reduced their demand increases. As regulations are ‘free’ and people who advocate or bring in regulations do not bear their costs, it is virtually certain that the demand for government regulations will continue to grow indefinitely.

An important question arising here is that, do these regulations by the government really not cost us anything? Is the cost always borne by big corporations and evil businessmen? Businessmen may initially bear the costs but be sure that ultimately the burden of the costs which have arisen due to regulation will fall on you and me- The Common Man. Do you want to know how this happens? This is made up by an increase in price of goods that we buy. We as consumers ultimately pay for all government regulations.

Each regulation imposed by the government on us means little to us when seen individually. The cost of each may be so infinitesimal, that we tend to ignore it and concentrate our attention on more pressing matters. The problem is that when the cost of all the regulations imposed on us is added up; it is no longer a small matter.

No one here doubts the intentions of our lawmakers. We know that regulations are often drafted with thoughts of making our buildings safer, food healthier, water hygienic, air pollution free, aircrafts less likely to have accidents and labour happy. The problem here is that the surfeit of regulations increases the costs of the basic necessities of life making life very difficult for the most vulnerable part of the society the poor people. They are not even able to afford the basic requirements needed for sustaining life.

The ill effects of regulating can be seen in the form of lobbying by big companies which capture the government agency in charge of making regulations and influence them to make such regulations which harm their competitors. In the UK, for example, large businesses wanted an onerous licensing burden to be applied to all food premises. These big companies knew that they would have a relatively easy time complying with these regulations, but their smaller competitors would be forced to shut shop. In the same manner, asking roadside restaurants in India or countries like Nepal, Bhutan or Sri Lanka to adhere to standards which are met by Hyatt or Holiday Inn would result in closure of the roadside small eateries. Commonsense tells us that this is not a desirable outcome.

Therefore, it is high time we should learn from the examples set by developed nations, they had far fewer regulations when they were at our level of development and try to rid ourselves of regulations if we are to banish poverty faster. Deregulating by creating wealth and unlocking capital would save lives. Rich people live longer by about 20 years – that is the difference in life expectancy between those living in the rich and those in poor countries.


  1. Aman
    November 25, 2011

    Even I feel the negativity spread by regulation in d form of reserving seats in medical colleges. Have been givng my entrance exams since 3 yrs and have not been able to clear my qualifying exam by 2-3 marks every year. I feel saddnend and frustrated by seeing the cut offs for reserved category students and the general category ones. Why does the govt create such a divide. Isnt it important that deserving candidates get their due????

  2. Neha
    November 28, 2011

    We used to feel that with time there will be more de-regularization but this is simply not happening. I think pro-active steps should be taken so than our younger generation doesnt suffer like we did

  3. Jetsyn
    November 29, 2011

    Home run! Great sulgngig with that answer!

  4. Sundance
    November 29, 2011

    Wow, this is in every respect what I needed to know.


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