Regulations

Everyone grumbles about rules, whether it’s doing the chores at home, or having to make small talk in social situations. But grudgingly, we accept that at least some of them are useful, and probably necessary. The discussion around government regulation is similar – most people accept that there should be some form of framework within which we lead our daily lives – we just can’t agree on what it should look like.

A key foundation of market systems is property rights. If we don’t know who owns what, it’s next to impossible to talk in terms of markets and exchange. But it’s more difficult than it would seem to determine who owns what, and more importantly, whether it’s fair that they do.

A minimum wage is a limit on how little you can legally pay someone to work. Most countries have a national minimum wage, and cities or regions often set minimum wages higher than the national minimum.¹ Economists have been fighting about minimum wages for over 100 years.² One camp says minimum wages pose a nasty trade off: wages go up for some workers, but other workers lose their jobs. The other side thinks minimum wages can help all workers, with businesses footing the bill.

Financial regulations are rules that are intended to keep the financial system safe. Some of these rules keep people from getting cheated by their banks — those are consumer protection laws. But there are also a ton of rules which are designed to keep the banking system as a whole from coming crashing down. As you might hope, this last set of rules has gotten a little tougher since the global financial crash back in 2008.