In a paper entitled "The Cost of Regulatory Compliance in the United States," Francesco Trebbi (University of California, Berkeley) and Miao Ben Zhang (University of Southern California) quantified the compliance costs for US firms between 2002 and 2014. They found that a typical company spent 1.34% of its total salary expenditure on employees engaged in regulatory compliance.
The researchers also analyzed how firm size impacts regulatory compliance outlay. "[E]conomies of scale in regulatory compliance are a key feature of any regulatory architecture," they wrote. "Regulation may also introduce incentives toward concentration and may act as a barrier to entry, favoring large incumbents."
This content is available to paid Members of Starling Insights.
If you are a Member of Starling Insights, you can sign in below to access this item.
If you are not a member, please consider joining Starling Insights to support our work and get access to our entire platform. Enjoy hundreds of articles and related content from past editions of the Compendium, special video and print reports, as well as Starling's observations and comments on current issues in culture & conduct risk management.
Join The Discussion