Is Regulation to Blame for the Decline in American Entrepreneurship?

Nathan Goldschlag, Alex Tabarrok; Is regulation to blame for the decline in American entrepreneurship?, Economic Policy, Volume 33, Issue 93, 1 January 2018, Pages 5–44, https://doi.org/10.1093/epolic/eix019

GMU Working Paper in Economics No. 15-11

46 Pages Posted: 5 Feb 2015 Last revised: 20 Oct 2018

See all articles by Nathan Goldschlag

Nathan Goldschlag

Center for Economic Studies, U.S. Census Bureau

Alexander T. Tabarrok

George Mason University - Department of Economics

Date Written: December 1, 2014

Abstract

Mounting evidence suggests that economic dynamism and entrepreneurial activity are declining in the United States. Over the past 30 years, the annual number of new business startups and the pace of job reallocation have declined significantly. We ask whether this decline in dynamism can be explained by federal regulation. We combine measures of dynamism with RegData, a novel dataset leveraging the text of the Code of Federal Regulations to create annual measures of the total quantity of regulation by industry. We find that rising federal regulation cannot explain secular trends in economic dynamism.

Keywords: regulation, entrepreneurship, job creation, job destruction

JEL Classification: E60, G18, M13, J63

Suggested Citation

Goldschlag, Nathan and Tabarrok, Alexander T., Is Regulation to Blame for the Decline in American Entrepreneurship? (December 1, 2014). Nathan Goldschlag, Alex Tabarrok; Is regulation to blame for the decline in American entrepreneurship?, Economic Policy, Volume 33, Issue 93, 1 January 2018, Pages 5–44, https://doi.org/10.1093/epolic/eix019; GMU Working Paper in Economics No. 15-11. Available at SSRN: https://ssrn.com/abstract=2559803 or http://dx.doi.org/10.2139/ssrn.2559803

Nathan Goldschlag

Center for Economic Studies, U.S. Census Bureau ( email )

4600 Silver Hill Road
Washington, DC 20233-9100
United States

Alexander T. Tabarrok (Contact Author)

George Mason University - Department of Economics ( email )

MSN 1D3
4400 University Drive
Fairfax, VA 22030
United States
703-993-2314 (Phone)

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