Dealing with Losers

Whenever governments change policies--tax expenditure or regulatory policies among others--there will typically be losers: people or groups who relied upon and invested in physical financial or human capital predicated on or even deliberately induced by the pre-reform set of policies. The issue of whether and when to mitigate the costs associated with policy changes either through explicit government compensation grandfathering phased or postponed implementation is ubiquitous across the policy landscape. Much of the existing literature covers government takings yet compensation for expropriation comprises merely a tiny part of the universe of such strategies.