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Compliance costs and productivity: an approach from working hours

Author

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  • Masayuki Morikawa

    (Hitotsubashi University
    Research Institute of Economy, Trade and Industry (RIETI))

Abstract

This study proposes a new approach of measuring compliance costs of rules and regulations by focusing on labor input, and estimates the compliance costs in Japan based on a survey of workers. According to the results, the working hours required to comply with rules and regulations account for more than 20% of total labor input. By industry, this cost is higher in the finance and insurance industry followed by the health and welfare industry, and by firm size, it is higher in large firms. If these costs were halved, overall economic productivity would increase by about 8%.

Suggested Citation

  • Masayuki Morikawa, 2023. "Compliance costs and productivity: an approach from working hours," Journal of Regulatory Economics, Springer, vol. 63(3), pages 117-137, June.
    • Handle: RePEc:kap:regeco:v:63:y:2023:i:3:d:10.1007_s11149-023-09460-3
    DOI: 10.1007/s11149-023-09460-3
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    More about this item

    Keywords

    Regulation; Compliance cost; Productivity; Labor input;
    All these keywords.

    JEL classification:

    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply
    • L51 - Industrial Organization - - Regulation and Industrial Policy - - - Economics of Regulation
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence

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