How New Regulations Affect Business GrowthHow New Regulations Affect Business Growth

When we hear about new regulations, we often hear that they will stifle economic growth and harm businesses. But how much is true of this claim? Fortunately, recent research on the subject sheds light on the question.

Regulations are new regulations to our country’s economy and provide benefits to consumers, workers, and the environment that cannot be quantified in dollars and cents. For example, environmental regulations protect us from dangerous pollutants and ensure that workers are protected on the job. They also help companies become more competitive in the marketplace by allowing them to offer products that meet higher environmental standards.

Despite these many benefits, the popularity of the idea that too many regulations harm economic growth has led some to argue that they should be reduced or eliminated. But before we do so, it is important to understand the real-world consequences of doing so.

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For instance, a study for the Mercatus Center found that more regulations are associated with fewer new business births and slower employment growth, with this effect primarily hitting smaller firms. Furthermore, these effects are exacerbated when existing firms can easily overcome the costs of compliance and are therefore able to take advantage of new entrants.

For this reason, it is critical for entrepreneurs to keep up with regulatory changes. This can be done by monitoring government websites, subscribing to industry newsletters and attending conferences or seminars related to their businesses. It is also wise to seek advice from legal or regulatory experts when implementing new policies that may be affected by changing regulations.

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