11 September 2006

Regulatory Capture

When people like me who teach regulation discuss theories of regulation, we normally start with the "public interest theory" because that is the intellectual rationale for regulation. We then discuss how it is difficult to show how public interest regulation meets a "public interest" standard. One of the alternative theories that is offered is called "capture theory". All of this is a preface to a pointer to this article that Tim Lee posted over at Technology Liberation Front (that amounts to a book synopsis) on this topic.

Technorati Tags:
, , ,

1 comment:

Pat said...

It is true that government should focus on public interest. Between the lines, individuals are the most important they should care about. It is also true that when the public as a whole has a lot at stake, any one person has only a very small stake and so has little incentive to invest resources in affecting the regulatory process. This shows why companies as big stake holders are looking to capture the regulatory process. How could we define “public interest” differently from “special interest” group? This will be very interesting.