The role of independent regulators in policy making: Venue‐shopping and framing strategies in the EU regulation of old wives cures

This article addresses debates on the formulation of public policy, building upon a body of literature which has focused on the interconnectedness between the venues of policy action and the way issues are defined. It does so by focusing on the strategic role of policy actors in a policy subfield and their attempts at manipulating either frames or venues in order to shape policy. The novelty here consists in pointing to the involvement of regulators in such strategic action. An emerging body of research has indeed shown that the activity of formally independent regulators is not necessarily limited to the implementation of delegated regulatory competencies and that they are increasingly engaged in policy‐making activities. Thus, by resorting to the agenda‐setting and framing literature, the article sheds light on novel pathways through which regulators intervene in policy‐making activities, making a claim that they have very good ‘tools’ at their disposal in order to shape policy. These dynamics are examined in the case of the last piece of the EU's pharmaceutical framework – the 2004 Directive on Traditional Herbal Medicines – which provoked intense debate among manufacturers of herbals, retailers, consumers, and both EU‐level and domestic‐level regulatory authorities.     

Epistemic contestation and interagency conflict: The challenge of regulating investment funds

Scholarship on regulating global finance emphasizes the importance of national and bureaucratic interests, but less attention has been devoted to epistemic sources of regulatory conflict. We address this by analyzing the failure of regulators to agree tougher rules for large investment funds after the 2008 crisis. The article suggests this outcome was the result of epistemic contestation between prudential regulators and securities regulators, rooted in divergent interpretive “frames.” We show that US and EU prudential regulators pushed for entity-based regulation of investment funds by escalating the issue to global standard-setting bodies. But this was successfully resisted by securities regulators that exercised epistemic authority through recursive practices—appeals to expertise, jurisdictional claims, and alliance building—to defend their transaction-based approach. The article demonstrates how an interpretivist perspective can provide new insights into inter-agency conflict and regulatory disputes in other policy fields.     

Judicious Incentives: International Public Policy Responses to the Globalization of Environmental Management

Public policymakers and regulators worldwide are grappling with the desire to improve environmental quality through appropriate regulation of business, while also streamlining government. Concurrently, environmentally conscience consumers are calling for improved environmental performance by industry. As a result of these pressures, regulators and lawmakers worldwide are attempting to craft effective policies that create adequate incentives for environmental protection on the part of firms, in the face of decreasing budgets and an increased demand for the use of market‐based incentives. To aid decision makers as they struggle with these concerns, this study provides a detailed case examination of the dilemmas and responses of national‐level regulators as they try to develop appropriate responses to the rise of international and “voluntary” management regimes. To accomplish these goals, this article compares the public policy responses of governments around the world to one such voluntary international environmental regime: ISO 14001. ISO 14001 is a form of industry self‐regulation in response to market forces calling for harmonization in environmental management and as a result of consumer and trade‐partner demands. This study examines the relationships between regulators and the regulated in order to understand if ISO 14001 certified firms are receiving regulatory relief or other forms of public policy/regulatory benefits as a result of their certification. It will also examine the impact that government incentives (or their absence) are having on the certification decisions of firms around the world. This information helps us to begin to understand how the trends toward smaller government and voluntary environmental regimes are affecting one another.     

Principles for Public Management Practice: From Dichotomies to Interdependence

In this essay we explore the relationship between management practices and a basic governance dilemma: how to manage flexibly and accountably. The challenge is both practical and theoretical. Managers must respond flexibly to the changing demands and expectations of the public and the ever-changing nature of public problems, yet they must do so in a manner that provides accountability to the public and political overseers. A dichotomous approach to the study of leadership as management action and the governance structures within which managers operate has inhibited the search for a public management theory that reconciles the dilemma. Emphasis upon managers as leaders typically focuses on the flexible actions managers might take to overcome structural "barriers," while emphasis upon governance structures typically focuses on the essential role of structure in ensuring accountability and restraining or motivating particular management efforts. The practicing manager, however, cannot deal with these aspects of the work separately. Managers must attend to demands for both flexible leadership action and structures that promise accountability. Anecdotal evidence provides illustrations of some of the ways that managers can integrate these demands. We suggest that these efforts point to an alternative theoretical framework that understands action and structure as mutually constitutive, creating a dynamic tension in which attention to one requires attention to the other.     

The Transformation of organic regulation: The ambiguous effects of publicization

The regulatory regime for organic products is different from other non‐state‐market driven (NSMD) regimes because it is the only one that evolved from a purely private into a regime where the establishment of minimum standards has become the monopoly of public powers. This article is the first to study the effects of the process of publicization, a term coined to characterize the transformation of private into public standards. The central hypothesis studied is that the process of publicization has empowerment and containment effects at the same time. To test the hypothesis the article analyses the effects of publicization on regulatory capabilities of private regulators as well as on the quality of the standards. The effects of publicization are further explored by comparing the legal and institutional architecture that shapes the coexistence of private and public regimes in the EU and the US, showing important differences between the two systems. The article offers a new perspective to look at the dynamic interaction between private and public regulation and its findings are of general relevance for the debate on the desirability of governmental intervention on private regulatory schemes.     

Uber Über regulation? Regulatory change following the emergence of new technologies in the taxi market

Can emerging technologies transform not only markets, but also foster new regulatory change mechanisms? In the context of prevailing theories of regulatory change, this article explores the extent to which an interest‐based explanation can account for the regulatory responses toward emerging Transportation Network Companies (TNCs). Based on a primary cross‐city analysis of the 40 largest cities in the United States, the study found that although the existence of ex ante interest groups indeed somewhat limited the extent of ex post regulatory acceptance of TNCs, regulators seemed to prefer the newcomers over existing incumbents and approved TNCs in 77.5 percent of the examined cities, rarely pursuing harsh enforcement even when TNCs operated illegally. The research attempts to explain this intriguing phenomenon by extending the interest‐based approach to account for the key role played by “technological regulatory entrepreneurs.” The entrepreneurs bridged collective action barriers by becoming the central agent that managed, and reaped the benefits of, the collective action, by lowering the organizational costs and by disseminating information effectively and turning consumers into political campaigners, thus successfully promoting regulatory change.     

Agencies’ formal independence and credible commitment in the Latin American regulatory state: A comparative analysis of 8 countries and 13 sectors

This article tests functional and institutional explanations for the different levels of formal independence of regulatory agencies in Latin America. The analysis is grounded in an original database of the formal independence level of 104 regulators in 8 countries and 13 regulatory sectors. The results challenge a central claim of the credible commitment hypothesis as they indicate that privatization is not a significant determinant of agency independence nor are utility regulators more likely to be independent than other economic regulators. Veto players are positively correlated with formal independence, indicating that in developing countries they operate together as credibility‐enhancing mechanisms, rather than as functional equivalents, as previous studies on developed countries have shown. Democratization is positively correlated with formal independence, whereas trade opening and vulnerability to international pressures has no significant impact. Hence, this article enhances the understanding of the delegation of regulatory powers to formally independent agencies in developing countries.     

When risk‐based regulation aims low: Approaches and challenges

Risk‐based regulation is becoming a familiar regulatory strategy in a wide range of areas and countries. Regulatory attention tends to focus, at least initially, on high risks but low‐risk regulatees or activities tend to form the bulk of the regulated population. This article asks why regulators need to address low risks and it outlines the potential difficulties that such risks present. It then considers how regulators tend to deal with lower risks in practice. A body of literature and survey‐based research is used to develop a taxonomy of intervention strategies that may be useful in relation to low‐risk activities, and, indeed, more widely. In an article to be published in the subsequent issue of this journal, we will then develop a strategic framework for regulators to employ when choosing intervention strategies and we will assesses whether, and how, such a framework could be used by regulatory agencies in a manner that is operable, dynamic, transparent, and justifiable.     

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.     

Salt,high blood pressure,and performance‐based regulation

Performance‐based regulation is a new approach to public health promotion. The aim of this article is to explain how this idea might be applied to the public health goal of reducing salt consumption as a way of reducing high blood pressure and thereby saving lives. Performance‐based regulation is compared with competing regulatory strategies.     

Republican Freedom,Popular Control,and Collective Action

Republicans hold that people are dominated merely in virtue of others' having unconstrained abilities to frustrate their choices. They argue further that public officials may dominate citizens unless subject to popular control. Critics identify a dilemma. To maintain the possibility of popular control, republicans must attribute to the people an ability to control public officials merely in virtue of the possibility that they might coordinate their actions. But if the possibility of coordination suffices for attributing abilities to groups, then, even in the best case, countless groups will be dominating because it will be possible for their members to coordinate their actions with the aim of frustrating others' choices. We argue the dilemma is apparent only. To make our argument, we present a novel interpretation of the republican concept of domination with the help of a game‐theoretic model that clarifies the significance of collective action problems for republican theory.     

Formal independence of regulatory agencies and Varieties of Capitalism: A case of institutional complementarity?

The Varieties of Capitalism literature posits that national economic institutions reflect the mode of coordination of a country's market actors. Despite the importance of this claim and a rich literature on the emergence of regulatory capitalism, few studies test such prediction for Independent Regulatory Agencies (IRAs). This article connects the two fields of research by analysing the impact of economic coordination on the formal independence of IRAs. The results show that, beyond issues of credible commitment and policy stability, the collective action capacity of market actors matters. In particular, regulators in Coordinated Market Economies enjoy less independence than in Liberal Market Economies, while intermediate regimes grant IRAs the least autonomy. The policy implications are nontrivial. Similar to other macroeconomic institutions, inappropriate combinations of economic coordination and IRA independence may engender Pareto‐suboptimal regulatory solutions. In such cases, policymakers should reconsider the rules governing national regulators.     

Agency under constraint: Ideological preferences and the politics of electricity regulation in Latin America

Whereas both the literature on globalization and the literature on regulatory diffusion stress the pressures that led to policy convergence, this article shows how the ideology of incumbents produced different regulatory outcomes, even in the face of strong financial and technological pressures that constrained policy agency. By looking at the regulatory frameworks adopted at the time of electricity privatization in Latin America, this article shows that right‐wing governments adopted regulations that eliminated barriers to entry and investment and limited the discretion of regulators (market‐conforming regulations), and that former statists who had pragmatically converted to the market creed instead chose regulations that tended to impose higher barriers to entry and investment and gave regulators wide discretion in conflict resolution and price setting (market‐controlling regulations). These findings suggest the need to look at the ideology (and ideological legacies) of government coalitions for a more nuanced understanding of the process of regulatory diffusion that took place across many sectors in most regions of the world.     

Complaining about rivals: Indifference,cooperation, and competition in the governance of advertising

What should rivals do when they see competitors breaking agreed rules within systems of self‐regulation? This study investigates compliant behavior among British advertisers to empirically answer this question. It analyses five years of complaints (n = 146,062) and adjudications (n = 4,832) published by the self‐regulatory body for the British advertising industry. The majority of firms adopt a strategy of indifference and rarely regulate their rivals. Highly engaged firms either adopt an angelic strategy as they use their resources to complain about their rivals; a deviant strategy as they are subject to a large number of complaints; or a predatory strategy as they attack their rivals through advertising regulation. This illustrates a unique form of regulatory capture in which a regulatory system becomes an arena of competition for some actors while continuing as a governance mechanism for others.     

The effectiveness of NGO self‐regulation: theory and evidence from Africa

Non‐governmental organizations (NGOs) play an increasingly important role in public service provision and policy making in sub‐Saharan Africa, stimulating demand for new forms of regulatory oversight. In response, a number of initiatives in NGO self‐regulation have emerged. Using cross‐national data on 20 African countries, the article shows that self‐regulation in Africa falls into three types: national‐level guilds, NGO‐led clubs and voluntary codes of conduct. Each displays significant weaknesses from a regulatory policy perspective. National guilds have a broad scope, but require high administrative oversight capacity on the part of NGOs. Voluntary clubs have stronger standards but typically have much weaker coverage. Voluntary codes are the most common form of self‐regulation, but have the weakest regulatory strength. This article argues that the weakness of current attempts to improve the accountability and regulatory environment of NGOs stems in part from a mismatch between the goals of regulation and the institutional incentives embedded in the structure of most self‐regulatory regimes. The article uses the logic of collective action to illustrate the nature of this mismatch and the tradeoffs between the potential breadth and strength of various forms of NGO self‐regulation using three detailed case studies. Copyright © 2008 John Wiley & Sons, Ltd.     

Paradoxes of plural unionism: CGT‐CFDT relations in France

This paper examines the dynamics of ‘plural unionism’ in France, specifically the relationship between the two largest trade unions, the Confédération Générale du Travail (CGT) and the Confédération Française Démocratique du Travail (CFDT). Four major themes are explored: (I) Unity of action (unité d'action) between the two unions is strongly influenced by the wider economic and political contexts; (2) Unity of action between the CGT and CFDT appears more pronounced at the national level than at the plant level; (3) CGT‐CFDT unity of action is associated with greater organisational effectiveness and ‘success’ in terms of winning workplace demands; and (4) Unity of action as an organisational strategy poses a dilemma for the CFDT, namely a trade‐off between effectiveness and radicalism.     

Does formal independence of regulators change? Evidence from Portuguese agencies

The rise of the regulatory state has led to the global diffusion of independent regulatory agencies (IRAs). IRAs are the result of the tension between the functional demands of regulatory capitalism and the need of politicians to control policies. Their life cycles have not been linear. Their legal statuses have changed over time, affecting their degrees of independence. This article revisits Gilardi's formal independence index, makes an in‐depth diachronic and cross‐sectorial analysis of 11 regulatory bodies in Portugal, and searches for explanations for the observed variations. It concludes that the formal independence of IRAs tends to increase due to external pressure and the need of governments to project credible commitment, but principals only grant as much independence as they see fit to satisfy those (external) demands (for change).     

The Limits to Evidence‐Based Policy: Evidence,Emotion and Criminal Justice1

While ‘evidence‐based’ or ‘rationalist’ approaches to criminal policy may appeal to technocrats, bureaucrats and a number of academics, they often fail to compete successfully with the affective approaches to law and order policies which resonate with the public and which appear to meet deep‐seated psychological needs. They also often fail to recognise that ‘policy’ and ‘politics’ are related concepts and that debates about criminal justice are played out in broader arenas than the academy, the bureau or the agency. To be successful, penal reform must take account of the emotions people feel in the face of wrongdoing. Further, successful reform must take into account changes in public ‘mood’ or emotions over time and be sensitive to different political and social cultures. This article argues that criminal justice policies are more likely to be adopted if, in addition to the gathering and presentation of evidence, they recognise and deal with the roles of emotions, symbols, faith, belief and religion in the criminal justice system. It also recognises that evidence alone is unlikely to be the major determinant of policy outcomes and that the creation and successful implementation of policy also requires extensive engagement and evidence‐based dialogue with interested and affected parties. This necessitates a different kind of modelling for evidence‐based policy processes.     

The Regulatory Gift: Politics,regulation and governance

This article introduces the “regulatory gift” as a conceptual framework for understanding a particular form of government‐led deregulation that is presented as central to the public interest. Contra to theories of regulatory capture, government corruption, “insider” personal interest, or profit‐seeking theories of regulation, the regulatory gift describes reform that is overtly designed by government to reduce or reorient regulators’ functions to the advantage of the regulated and in line with market objectives on a potentially macro (rather than industry‐specific) scale. As a conceptual framework, the regulatory gift is intended to be applicable across regulated sectors of democratic states and in this article the empirical sections evidence the practice of regulatory gifting in contemporary United Kingdom (UK) politics. Specifically, this article analyses the 2011 UK Public Bodies Act, affecting some 900 regulatory public bodies and its correlative legislation, the 2014 Regulator's Code, the 2015 Deregulation Act, and the 2016 Enterprise Bill. The article concludes that while in some cases the regulatory gift may be aligned with the public interest – delivering on cost reduction, enhancing efficiency, and stimulating innovation – this will not always be the case. As the case study of the regulatory body, the UK Human Fertilisation and Embryology Authority, demonstrates, despite the explicit claims made by legislators, the regulatory gift has the potential to significantly undermine the public interest.     

Toward the usable recognition of individual benefits and costs in regulatory analysis and governance

Regulatory agencies in the United States and Europe have well‐deserved reputations for fixating on the total benefits and costs of proposed and final regulatory actions, without doing any more than anecdotally mentioning the subpopulations and individuals who may bear disproportionate costs or reap disproportionate benefits. This is especially true on the “cost” side of the cost–benefit ledger, where analysts exert little effort to even inform decisionmakers and the public that the costs of regulations might be distributed either regressively or progressively. Many scholars and advocates have observed that regulation can increase the efficiency of market outcomes, but caution about its untoward (or suboptimal) effects on equity. Here, we argue that without considering distributional information about costs and benefits, regulatory policies in fact can also cause violence to notions of efficiency, for two reasons: (i) society cannot hope to approach Pareto‐efficient outcomes without identifying those who must lose so that others can gain more; and (ii) because the harm experienced by involuntary risks and by imposed regulatory costs is likely non‐linear in its magnitude (at the individual level), efficiency is, in fact, a strong function of the shape of the distribution of these effects. This article reviews evidence about the distribution of regulatory costs and benefits, describes how agencies fail to incorporate readily available distributional information, and sketches a vision for how they could analyze costs and benefits to promote more efficient regulatory choices and outcomes.