...rules with high cost of compliance are introduced to keep the fixed pool of resources from being divided between too many people. Is there an example of that?
I think tax codes fall under this category. You can keep the money you earned if you are already part of the economic elite—you already have enough money to have things like offshore bank accounts (worth it only if you can afford to squirrel away large sums) and high-yield investments (which have a good deal of risk attached to them, so are a potentially very costly way of investing; if you can’t afford to lose the cash you shouldn’t buy these, but they can be very lucrative for those who can afford to lose on occasion), or to hire an expert who can help you manage large swaths of your cash flow. Without that initial capital, you are unable to take advantage of tax laws (and other economic systems) in the same way as those who have more to work with in the first place. This kind of system tends to encourage economic resources to accumulate with those few who already control a lot.
Another example may be found in business law. I don’t own a business, so can’t get get very specific I’m afraid, but I gather that licensing and payroll and (again) tax concerns (among other issues) are often legally tuned in such a way that larger corporations have an easier time achieving compliance than smaller businesses. Laws designed, for example, to protect the environment from the waste output of a large factory could easily be written to except the local shop engaging in a similar process but at many orders less magnitude. Instead, I routinely encounter news articles (publication bias alert) highlighting the plight of local businesses as they struggle to keep financially afloat and stay legal. This kind of system tends to encourage business resources to accumulate with those businesses that already control a lot.
It’s usually not so much that payroll or taxes are “legally tuned” to the benefit of larger corporations but that complying with all of the relevant laws and regulations is a relatively large ‘fixed cost’ that can be more easily born by a larger organization. Even something like initially selecting a payroll company, or monitoring (and potentially switching to another) payroll company is something more easily, and less costly, performed by a dedicated HR professional, let alone a group of professionals in an HR department, whereas lots of small businesses don’t even have a full-time, dedicated HR person.
I think tax codes fall under this category. You can keep the money you earned if you are already part of the economic elite—you already have enough money to have things like offshore bank accounts (worth it only if you can afford to squirrel away large sums) and high-yield investments (which have a good deal of risk attached to them, so are a potentially very costly way of investing; if you can’t afford to lose the cash you shouldn’t buy these, but they can be very lucrative for those who can afford to lose on occasion), or to hire an expert who can help you manage large swaths of your cash flow. Without that initial capital, you are unable to take advantage of tax laws (and other economic systems) in the same way as those who have more to work with in the first place. This kind of system tends to encourage economic resources to accumulate with those few who already control a lot.
Another example may be found in business law. I don’t own a business, so can’t get get very specific I’m afraid, but I gather that licensing and payroll and (again) tax concerns (among other issues) are often legally tuned in such a way that larger corporations have an easier time achieving compliance than smaller businesses. Laws designed, for example, to protect the environment from the waste output of a large factory could easily be written to except the local shop engaging in a similar process but at many orders less magnitude. Instead, I routinely encounter news articles (publication bias alert) highlighting the plight of local businesses as they struggle to keep financially afloat and stay legal. This kind of system tends to encourage business resources to accumulate with those businesses that already control a lot.
It’s usually not so much that payroll or taxes are “legally tuned” to the benefit of larger corporations but that complying with all of the relevant laws and regulations is a relatively large ‘fixed cost’ that can be more easily born by a larger organization. Even something like initially selecting a payroll company, or monitoring (and potentially switching to another) payroll company is something more easily, and less costly, performed by a dedicated HR professional, let alone a group of professionals in an HR department, whereas lots of small businesses don’t even have a full-time, dedicated HR person.