Policy Documents  Why Regulate? New Applications of the
'Johnston Test'  Joseph L. Bast – August 1, 2010  How
governments regulate businesses in their jurisdictions has a
major effect on economic growth. Along with taxes and government
spending, regulation is one of the three principal levers
policymakers can move to shape the business climate of their
nation, state, or city.  Most policymakers are relatively
uninformed about why governments regulate in the first place,
and consequently have difficulty framing the issue of regulatory
reform. It is hardly their fault: the academic literature shows
little consensus, and what agreement exists has not been
presented in a fashion that elected officials can apply to the
choices they face.  This essay attempts to fill this gap in the
literature. It offers a brief survey of theories of regulation
and the effects of regulation on economic growth, then comments
on some of the key issues concerning regulation in the areas of
consumer protection, the environment, and tel