Deregulating Medical Devices Will Increase Innovation and Safety

Deregulating Medical Devices Will Increase Innovation and Safety

Government regulation is supposed to make products safer. But new research shows that, at least for medical devices, regulation can have the opposite effect.

In a paper published this past November, UC San Diego economist Parker Rogers found that when the U.S. Food and Drug Administration reduces regulation on a category of products, innovation and competition in that category increase, prices decrease, and safety actually improves.

How could this be? Rogers hypothesized that firms “increas[e] their emphasis on product safety as deregulation exposes them to more litigation.”