Encyclopedia of Law and Economics

2019 Edition
| Editors: Alain Marciano, Giovanni Battista Ramello

Standard Cost Model

  • Wolfgang WeigelEmail author
Reference work entry
DOI: https://doi.org/10.1007/978-1-4614-7753-2_753


The Standard Cost Model is a tool for the reduction of administrative burdens of businesses. It rests on a fairly simple technique of identifying such activities which are found unnecessary by experts and thus have the potential of savings on expenses. The economic idea behind its application is that means are unleashed which can be used more efficient and effective, thus fostering growth. However, the tool also has a couple of shortcomings, which presently give rise to the development of a new generation of SCM (SCM 2.0).


The Standard Cost Model (SCM) is a widely used remedy against certain kinds of red tape. It belongs to the family of devices for less and better regulation, nowadays handled under the more handy label “smart regulation” (see: http://www.oecd.org/regreform/policyconference/46528683.pdf.) This model aims at identifying and measuring the administrative burdens of businesses. Thus, it is an indispensable prerequisite for steps towards the...

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Copyright information

© Springer Science+Business Media, LLC, part of Springer Nature 2019

Authors and Affiliations

  1. 1.Faculty of Business, Economics and Statistics, Department of EconomicsJoseph von Sonnenfels Center for the Study of Public Law and EconomicsViennaAustria