Bootleggers & Baptists: The Experience of Another Regulatory Economist

November 28, 2018

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Bruce Yandle conceived the theory of Bootleggers and Baptists based on his experience working in government as a young economist in the late 1970s and 1980s. Forty years later, his insights regarding the forces that converge to support government intervention continue to explain many regulatory observations. This article reviews the theory and applies it to the author’s own experience in government across several administrations and to the deregulatory environment of today. It finds that while the B&B phenomenon is universal, the nature of winning Baptist arguments can vary dramatically depending on administration, and that regulatory institutions can reinforce or counteract B&B pressures. It also observes that, despite general support for less regulation among companies, B&B coalitions are often motivated to resist individual deregulatory measures.

Over the last sixty years, the number and scope of federal regulations has grown dramatically. In 1960, the Code of Federal Regulations occupied around 70,000 pages; today it is more than 178,000. In 1960, 57,000 full-time federal regulators worked to develop and enforce regulations; in 2018 their numbers exceed 280,000. Concern over the continuously changing and progressively intrusive nature of the administrative state may have been one contributor to the surprise election of Donald Trump in November 2016. Voters were increasingly concerned that regulations were serving well-connected interests at the expense of everyday Americans.

This paper examines some recent trends in regulation through the lens of Dr. Bruce Yandle’s “Bootlegger and Baptist” (B&B) theory of regulation. Illustrations from my own experience in government and a review of regulatory and deregulatory activity during the first 18 months of the Donald Trump administration suggest that, while Baptist arguments may change from one administration to the next, the combination of moral and economic forces continue to influence regulatory policy.