Continuity,change, and priorities: The quality and use of regulatory analysis across US administrations

This paper compares the quality and use of regulatory analysis accompanying economically significant regulations proposed by US executive branch agencies in 2008, 2009, and 2010. We find that the quality of regulatory analysis is generally low, but varies widely. Budget regulations, which define how the federal government will spend money or collect revenues, have much lower‐quality analysis than other regulations. The Bush administration's “midnight” regulations finalized between Election Day and Inauguration Day, along with other regulations left for the Obama administration to finalize, tended to have lower‐quality analysis. Most differences between the Bush and Obama administrations depend on agencies' policy preferences. More conservative agencies tended to produce better analysis in the Obama administration, and more liberal agencies tended to do so in the Bush administration. This suggests that agencies more central to an administration's policy priorities do not have to produce as good an analysis to get their regulations promulgated.     

Setting the Regulatory Agenda: Statutory Deadlines,Delay, and Responsiveness

Congress imposes statutory deadlines in an attempt to influence agency regulatory agendas, but agencies regularly fail to meet them. What explains agency responsiveness to statutory deadlines? Taking a transaction cost politics approach, the authors develop a theory of responsiveness to deadlines centered on political feasibility to explain how agency managers map rulemaking onto calendar and political time. This theory is tested on all unique rules with statutory deadlines published in the Unified Agenda of Federal Regulatory and Deregulatory Actions between 1995 and 2012. The argument and findings about the timing and ultimate promulgation of rules have implications that reorient the study of the regulatory agenda from legal and political into more managerial terms.     

A COMPARATIVE ANALYSIS OF RULEMAKING PROVISIONS IN STATE ADMINISTRATIVE PROCEDURE ACTS

As the primary source of procedures that state agencies must follow, state Administrative Procedure Acts (APAs) structure administrative discretion in the promulgation of rules and regulations. While the federal APA has been studied extensively, much less has been written about state procedural statutes. This article describes the major rulemaking provisions in state APAs and provides a broad, comparative, and systematic understanding of these provisions. Our analysis yields three major findings. First, state procedural statutes vary considerably in the extent to which they structure administrative discretion in rulemaking. Second, adoption of these rulemaking provisions tends to vary in a systematic way, as states first incorporate due process provisions, and then adopt responsiveness and rationality provisions. Third, in the area of procedural regulatory reform, states have made considerable strides in reforming regulatory administration.     

Public Information and Regulatory Processes: What the Public Knows and Regulators Decide

Because bureaucratic agencies may be less transparent in their decision processes than legislatures, most states have developed processes to incorporate input from regulated communities and other parties potentially affected by regulations. Administrative agencies may encourage democratic practices to increase legitimacy and accountability of the bureaucracy and improve decision‐making processes. However, rules governing the regulatory process vary by state, with some incorporating more open practices than others. Understanding these dynamics is increasingly important, as the rulemaking process has become central to policymaking over the past several decades, with a large portion of policymaking authority delegated to administrative agencies. Drawing from regulatory documents, rulemaking comments, media coverage, and interviews with regulators in 14 regulatory decision processes across five states, this study finds that while states vary in their approach to providing access to information, there are overriding patterns that reduce the role of citizens and the overall transparency of regulatory processes.     

When risk‐based regulation aims low: A strategic framework

This article develops a strategic framework for regulators to employ when choosing intervention strategies for dealing with low risks and reviewing performance, building on the analysis by the same authors in the previous edition of this journal. The framework occupies the operational “middle ground” between risk analysis and formal enforcement action. At its core is a matrix, the Good Regulatory Intervention Design (GRID), which provides a framework to categorize sites or activities on the basis of two factors: the nature of the risk and the nature of the regulatee. Using GRID, regulators can select which intervention tools to use, and determine the overall level of regulatory intensity that should apply. GRID is accompanied by the Good Regulatory Assessment Framework (GRAF) for agencies to use in reviewing their performance and provides a step‐by‐step process for enabling “double loop learning.” The article also argues that the process of developing such a framework highlighted the extent to which “low risk” and “high risk” regulation are distinct. “Low risk” means “low priority.” Justifying why certain risks should not receive much regulatory attention requires a particular type of engagement, and has a bearing on the regulatory strategies that are adopted.     

The regulatory state in developing countries: Redistribution and regulatory failure in Brazil

Following the traditional doctrine of the “regulatory state”, regulatory agencies should be given very focused mandates and stay away from the politicized realm of distributive policies and decisions. An opposing perspective would state that if regulatory agencies can contribute to economic redistribution, positive results such as network expansion, economies of scale, and fiscal efficiency will ultimately lead to lower levels of regulatory failure. This article tests whether, in countries of high socio-economic inequality, such as Brazil, the active incorporation of distributive considerations by regulatory agencies leads to lower levels of failure. Through the analysis of the activities of seven Brazilian network regulatory agencies, the article develops theory-driven expectations and tests these expectations using crisp set Qualitative Comparative Analysis (csQCA). It concludes that not prioritizing redistribution is a necessary but not a sufficient condition for regulatory agencies' failure. In most types of failure, a lack of priority to redistribution leads to failure when combined with low regulatory capacity and low levels of competence.     

The States Come Marching In: Examining State Agency Influence on Federal Rules

Amidst congressional gridlock, administrative rulemaking is the main pathway for environmental policy making. Scholars have assessed the role of the institutions of government (the president, Congress, and the courts) and key interest groups (i.e., business and environmental interests) in shaping rulemaking outcomes. What is missing from this literature is an assessment of the role of key implementers, state environmental agencies. This research fills this gap by assessing the role and impact of state government agencies in three case studies of rulemaking at the Environmental Protection Agency (EPA). Based on original interviews and a public comment analysis, this research suggests that state agencies play an active and influential role in EPA rulemaking. And, in some cases, state agencies wield more influence than other interest groups. Interviewees argued that this influence stems from these agencies’ unique voice as an implementation collaborator. As a result, researchers should incorporate an assessment of the role of these interests to more effectively explain regulatory outcomes at the EPA and potentially across the bureaucracy.     

Economic and Ideological Corruptions of the Regulatory State

What accounts for the excesses of the regulatory state? Economists have shown that bad regulations are often due to “rent seeking” and “regulatory capture” and have provided compelling accounts of the incentives that drive these processes. However, there remain many unwarranted regulations, such as recent gun control measures, that cannot be explained by an economic rationale. Rather, it is essential to understand the distinctively ideological origins and functions of such regulations. This paper examines both the economic and ideological corruptions on the regulatory state, suggesting that those concerned with the growth of state power will have to address both of these phenomena.     

The complications of controlling agency time discretion: FDA review deadlines and postmarket drug safety

Public agencies have discretion on the time domain, and politicians deploy numerous policy instruments to constrain it. Yet little is known about how administrative procedures that affect timing also affect the quality of agency decisions. We examine whether administrative deadlines shape decision timing and the observed quality of decisions. Using a unique and rich dataset of FDA drug approvals that allows us to examine decision timing and quality, we find that this administrative tool induces a piling of decisions before deadlines, and that these “just-before-deadline” approvals are linked with higher rates of postmarket safety problems (market withdrawals, severe safety warnings, safety alerts). Examination of data from FDA advisory committees suggests that the deadlines may impede quality by impairing late-stage deliberation and agency risk communication. Our results both support and challenge reigning theories about administrative procedures, suggesting they embody expected control-expertise trade-offs, but may also create unanticipated constituency losses.     

Recipes for Pork and Other Delicious Offerings for the New Administration

Is pork produced by feeble budgetary processes? By fixing weak budgetary procedures, can wasteful spending and opportunities for corruption be reduced? This essay looks at three varieties of pork: earmarked, ad hoc, and presidential. What can be done to curb the excesses of each one? By examining the problem of congressional earmarking, this timely article proposes a new process for controlling “earmarked” pork by supporting a new (constitutional) presidential line‐item veto/reprogramming. “Ad hoc pork,” generated by emergency or stimulus bills, is also analyzed. Its downsides can be fixed, according to the essay, by creating a preapproved roadmap for the appropriations process, thereby enhancing the quality of spending oversight. Finally, “presidential pork” derives from chief executives rewarding congressional allies and from government agencies allocating program resources so as to engender support from congressional members. This third variety of pork can be controlled if agencies improve their operational transparency plus strengthen their procedures for selecting projects. What happens when you put good people in a bad place, good apples in a bad barrel? Do the apples change the barrel, or does the barrel change the apples? —Philip Zimbardo, 2008     

Increased protection in the 1980s: Exchange rates and institutions

The strong appreciation of the U.S. dollar between 1980 and 1985 encouraged the substitution of imports for domestically produced goods for a variety of products. This, in turn, increased the demand for trade protection. Many of these demands were satisfied via “apolitical” U.S. antidumping and countervail regulations, yieldingad valorem tariffs well above current average statutory duties. The supply of trade protection is developed via a principal-agent model that describes the potential gains to both the regulatory agency and the legislator. Empirical results support the model specification, finding both exchange rate and political cycles in the use of “apolitical” trade protection.     

Understanding the rise of the regulatory state of the South*

This paper, and the special issue it introduces, explores whether, and how, the rise of the regulatory state of the South, and its implications for processes of governance, are distinct from cases in the North. With the exception of a small but growing body of work on Latin America, most work on the regulatory state deals with the US or Europe, or takes a relatively undifferentiated “legal transplant” approach to the developing world. We use the term “the South” to invoke shared histories of many countries, rather than as a geographic delimiter, even while acknowledging continued and growing diversity among these countries, particularly in their engagement with globalization. We suggest that three aspects of this common context are important in characterizing the rise of the regulatory state of the South. The first contextual element is the presence of powerful external pressures, especially from international financial institutions, to adopt the institutional innovation of regulatory agencies in infrastructure sectors. The result is often an incomplete engagement with and insufficient embedding of regulatory agencies within local political and institutional context. A second is the greater intensity of redistributive politics in settings where infrastructure services are of extremely poor quality and often non‐existent. The resultant politics of distribution draws in other actors, such as the courts and civil society; regulation is too important to be left to the regulators. The third theme is that of limited state capacity, which we suggest has both “thin” and “thick” dimensions. Thin state capacity issues include prosaic concerns of budget, personnel and training; thick issues address the growing pressures on the state to manage multiple forms of engagement with diverse stakeholders in order to balance competing concerns of growth, efficiency and redistribution. These three themes provide a framework for this special issue, and for the case studies that follow. We focus on regulatory agencies in infrastructure sectors (water, electricity and telecoms) as a particular expression of the regulatory state, though we acknowledge that the two are by no means synonymous. The case studies are drawn from India, Colombia, Brazil, and the Philippines, and engage with one or more of these contextual elements. The intent is to draw out common themes that characterize a “regulatory state of the South,” while remaining sensitive to the variations in level of economic development and political institutional contexts within “the South.”     

THE POLITICS OF LEGISLATIVE CURTAILMENT OF ADMINISTRATIVE RULEMAKING: OBSTACLES TO POLICE-PATROL OVERSIGHT

State Administrative Procedure Acts (APAs), like their federal counterpart, attempt to even the odds that citizens’rights will be protected as administrative agencies exercise quasi-legislative and quasi-judicial functions. North Carolina is one of several states which has recently attempted to constrain agency power in rulemaking and complaint adjudication. This is a case study of policy outcomes attained by the North Carolina General Assembly in its 1985 revision of the state's APA. Why did some state legislators’efforts to assume stricter oversight over administrative rulemaking fall far short of the kind of control and accountability they aimed for? We explore three types of obstacles to APA reform encountered in North Carolina. Each is relevant to other states. First, direct surveillance or “police-patrol” techniques of legislative oversight impose undesirable political costs on legislators. Second, there is an absence of (or categorical precedence is against) the adoption of such techniques. Third, executive-legislative branch conflict and complex separation of powers issues arise when state legislatures attempt to curtail administrative rulemaking in significantly new and restrictive ways.     

Negotiated rulemaking in practice

Until recently, parties interested in rulemaking by federal agencies were forced to voice their views primarily through adversarial procedures. An alternative, negotiated rulemaking, was proposed by the Administrative Conference of the United States (ACUS) in 1982. Since then, negotiated rulemaking has been used four times by federal agencies. The four completed negotiations show that negotiated rulemaking permits affected interests to retain greater control over the content of agency rules, while ensuring fairness and balance. It also permits agencies to obtain a more accurate perception of the costs and benefits of policy alternatives than can be obtained from digesting voluminous records of testimonial and documentary evidence presented in adversarial hearings. This article summarizes the results of a recently completed report prepared by the author for the Administrative Conference. It reviews the genesis of negotiated rulemaking, presents a framework within which to understand dynamics of the negotiation process and related administrative law issues, and presents recommendations for future agency use of negotiated rulemaking recently adopted in substance by the Administrative Conference.     

What's wrong with the back of the envelope? A call for simple (and timely) benefit–cost analysis

Observers across the ideological spectrum have criticized benefit–cost analysis for as long as it has been part of the rulemaking process. Still, proponents and detractors agree that analysis has morphed into a mechanism often used by agencies to justify regulatory decisions already made. We argue that a simpler analysis of more alternatives conducted earlier in the regulatory process can resuscitate it as a tool to inform policy. Recognizing that requiring a procedure does not ensure that regulators will follow it, we offer possible remedies, including strengthening or relaxing subsequent review of proposed rules, which raise the cost of circumventing the reform or lower the cost of following it.     

Responsive bureaus,equity, and regulatory negotiation: an empirical view

Rulemaking agencies commonly delegate the implementation and enforcement of rules to affected parties, but they rarely delegate rulemaking authority. Regulatory negotiation is an example of this uncommon behavior. Compared to conventional rulemaking, regulatory negotiation is thought to be an attempt to make bureaucracy more responsive to affected stakeholders, especially when the rulemaking concerns politically complicated and technical issues. However, negotiation, while it may make bureaucrats more responsive, may also be less fair in that it is likely to result in relatively more responsiveness to interests supported by those with greater resources. This study presents empirical evidence that compares negotiated to conventional rulemaking processes at the Environmental Protection Agency in respect to both responsiveness and equality. The results uphold the expectation that negotiating rules appears more responsive than the conventional rule‐writing process. Furthermore, the results show inequality in both processes; outcomes of negotiated rules may be more unequal than outcomes of conventionally written rules. © 2002 by the Association for Public Policy Analysis and Management.     

Presidential coattails and electoral coordination in multilevel elections: Comparative lessons from Brazil

This article seeks to understand how concurrent presidential and gubernatorial elections in strong federal systems affect electoral coordination and coattails voting between national and subnational levels of government. We seek to determine whether the nationalizing effect of presidential elections can overcome the strong incentives for regionalization that can arise in federal systems. We use individual-level survey data and time-series cross-sectional electoral data from Brazil, a federal country with decentralized electoral institutions that has recently adopted concurrent presidential and gubernatorial elections. We find that the congruence between national and subnational elections increases when elections are temporally proximate and the effective number of presidential candidates is low. In short, the coattails effect can not only operate “horizontally,” by shaping national legislative elections, but also “vertically,” by shaping subnational elections.     

When Are Nudges Desirable? Benefit Validity When Preferences Are Not Consistently Revealed

Cost-benefit analysis, as a tool of general use in policy analysis or as a mandated analytical process in some rulemaking, provides protocols for assessing the relative efficiency of policy alternatives. However, inconsistent and apparently irrational decisions by consumers in some situations call into question the validity of inferring the values that consumers place on outcomes from their observed choices. It also opens the door for “nudges” that change the architecture of choice to promote more “rational” consumer choice. Differences between decision utility and experience utility and the willingness of consumers to pay for reductions in temptation provide conceptual bases for thinking about the efficiency of nudges. However, assessment of nudges and their role in behavioral public administration should also recognize that heterogeneous preferences can result in increases in utility for some and decreases for others. Therefore, nudges require systematic assessment like other policy instruments.     

Understanding commenter influence during agency rule development

We provide the first empirical assessment of commenter influence during the rule development stage of administrative rulemaking. We argue that public com‐menters play a critical agenda‐setting role during rule development. To test this proposition, we analyze data from 36 Department of Transportation rules and almost 500 comments. Each of these rules began with an Advance Notice of Proposed Rulemaking—a procedure that allows us to track the formal participation of interested parties during rule development. Our analyses are supplemented by face‐to‐face interviews with agency officials. We find a strong agenda‐setting role for early commenters—both in terms of affecting the content of future regulations and in thwarting unwanted regulations. We conclude that “early‐bird” com‐menters are well positioned to frame public policy debates as rules move through the regulatory process. © 2009 by the Association for Public Policy Analysis and Management.     

Crowdsourcing and regulatory reviews: A new way of challenging red tape in British government?

Much has been said about the appeal of digital government devices to enhance consultation on rulemaking. This paper explores the most ambitious attempt by the UK central government so far to draw on “crowdsourcing” to consult and act on regulatory reform, the “Red Tape Challenge.” We find that the results of this exercise do not represent any major change to traditional challenges to consultation processes. Instead, we suggest that the extensive institutional arrangements for crowdsourcing were hardly significant in informing actual policy responses: neither the tone of the crowdsourced comments, the direction of the majority views, nor specific comments were seen to matter. Instead, it was processes within the executive that shaped the overall governmental responses to this initiative. The findings, therefore, provoke wider debates about the use of social media in rulemaking and consultation exercises.