Warby Parker founder Neil Blumenthal makes a very interesting point about public policy and entrepreneurship when he observes that “The rules of optical dispensing vary from state to state. Dispensing eyeglasses is not that complicated and even if it were complicated, there should be uniform rules.”
People talk a lot in Washington about “regulation” rarely with reference to specific regulations or specific problems. And perhaps one of the most neglected problems concerns the information costs of regulation. Even a very sensible rule can be quite burdensome on a businessman if it’s difficult to find out what the rule says. If you have 50 slight variations of the same rule, then even if all 50 of the rules are totally reasonable, you’ve now created a giant burden to anyone looking to scale his business up or (like Warby Parker) innovate in the field of national distribution. Rules that can look totally innocuous individually can collectively become a problem to anyone who’s not a well-established incumbent. Improved transportation and information technology mean that many more lines of business can be “national” in scope than has traditionally been the case. The sensible response would be to shift more of these regulatory functions up to the federal level.