September, 2010

Regulatory Flexibility

How to Mitigate the Effects of Katrina and Other Disasters
Key materials
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This policy comment discusses the importance of reducing regulatory barriers to recovery in the wake of a disaster. The ability of a disaster-stricken area to recover depends to a great extent on a large number of private actors who have place- and time-specific information that is generally unavailable to government agencies. We find that laws that empower individuals to respond to events on the ground are likely to help disaster-affected cities recover faster.

We present our findings as follows:

  1. We briefly provide a background on government response to disasters and explain how social learning can become embodied in rules that allow for exceptional enforcement during disasters. We apply the concept to New Orleans and highlight specific cases where rigid regulations stood in the way of the post-Katrina recovery.
  2. We provide examples of flexibility allowed under emergency conditions and show how regulatory flexibility can enable state government to avoid gridlock in the face of a major disaster.
  3. We provide some lessons based on a review of state laws. We show how those lessons can be applied to federal agencies.
  4. We offer specific policy proposals based on our findings.