On the value of formal assessment of uncertainty in regulatory analysis

The US Office of Management and Budget introduced in 2003 a new requirement for the treatment of uncertainty in Regulatory Impact Analyses (RIAs) of proposed regulations, requiring agencies to carry out a formal quantitative uncertainty assessment regarding a regulation’s benefits and costs if either is expected to reach $1 billion annually. Despite previous use in other contexts, such formal assessments of uncertainty have rarely been employed in RIAs or other regulatory analyses. We describe how formal quantitative assessments of uncertainty – in particular, Monte Carlo analyses – can be conducted, we examine the challenges and limitations of such analyses in the context of RIAs, and we assess how the resulting information can affect the evaluation of regulations. For illustrative purposes, we compare Monte Carlo analysis with methods typically used in RIAs to evaluate uncertainty in the context of economic analyses carried out for the US Environmental Protection Agency’s Nonroad Diesel Rule, which became effective in 2004.     

Globalization and legal change: The “Americanization” of European law?

Intensified global economic competition, economic liberalization, and the rise of EU governance have led some observers to argue that there has been a trend toward the “Americanization” of the European “way of law.” This article addresses that contention, focusing on legal change in European member states. It first describes ways in which the American legal tradition has differed most sharply from the national legal systems of Western Europe (including Great Britain) and the political and economic factors that account for this “American legal distinctiveness.” Similar political and economic factors currently are at work in Europe, the article acknowledges, creating incentives for legal convergence. But it also argues that European legal culture and the political organization of European national states generate path‐dependent forces that impede European movement toward American ways of law, and it discusses six important differences between European and American law that remain entrenched and are unlikely to disappear.     

The economic significance of “insignificant” rules

We know relatively little about the economic effects of “insignificant” rules because they are not typically analyzed. Yet, these rules could be cumulatively important. We provide an economic analysis of one proposed rule to control hazardous air pollutants, which is not considered to be economically significant. This rule is of particular interest because it is one of the first in a long series of rules that Environmental Protection Agency (EPA) will consider for limiting hazardous air pollutant emissions. Our analysis suggests that the proposed controls that EPA has considered are not likely to pass a benefit–cost test. We recommend that an agency base its decision to allocate additional resources to benefit–cost analysis on the expected value of the improved information. In addition, agencies should consider applying a rule of thumb that would specify a threshold level of risk reduction that needs to be achieved before some kinds of regulation are considered.     

Wie lässt sich Demokratie am besten messen? Zur Konzeptqualität von Demokratie-Indizes

This article proposes a new instrument for the assessment of the concept quality of democracy indices. We evaluate six famous democracy measurement datasets along our instrument’s requirements and show that the indices perform quite differently: The Index on Defect Democracy receives the best scores, whereas the Freedom House Index gets the worst. In addition, we provide some new insights as to general weaknesses of democracy measurement.     

School choice,racial segregation,and test‐score gaps: Evidence from North Carolina's charter school program*

Using panel data that track individual students from year to year, we examine the effects of charter schools in North Carolina on racial segregation and black‐white test score gaps. We find that North Carolina's system of charter schools has increased the racial isolation of both black and white students, and has widened the achievement gap. Moreover, the relatively large negative effects of charter schools on the achievement of black students is driven by students who transfer into charter schools that are more racially isolated than the schools they have left. Our analysis of charter school choices suggests that asymmetric preferences of black and white charter school students (and their families) for schools of different racial compositions help to explain why there are so few racially balanced charter schools. © 2006 by the Association for Public Policy Analysis and Management.     

The impact of child support enforcement policy on nonmarital childbearing

The interaction of welfare and child support regulations has created a situation in which child support policy's incentives that discourage unwed fatherhood tend to be stronger than its incentives that encourage unwed motherhood. This suggests that more stringent child support enforcement creates incentives that reduce the likelihood of nonmarital childbearing, particularly among women with a significant chance of needing public assistance in the event of a nonmarital birth and their male partners. We investigate this hypothesis with a sample of women from the Panel Study of Income Dynamics, to which we add information on state child support enforcement. We examine childbearing behavior between the ages of 15 and 44 before marriage and during periods of non‐marriage following divorce or widowhood. The estimates indicate that women living in states with more effective child support enforcement are less likely to bear children when unmarried, especially if they are young, never‐married, or black. The findings suggest that improved child support enforcement may be a potent intervention for reducing nonmarital childbearing. © 2006 by the Association for Public Policy Analysis and Management.     

Indigenous Rights,Resistance, and the Law: Lessons from a Guatemalan Mine

Using a case study of a controversial mine in an indigenous area of Guatemala, this article explores the transnational dynamics of development and regulation of large‐scale extractive industry projects in the developing world. It examines the roles played in the Marlin mine dispute by national law, international law, international financial institutions, and corporate social responsibility. It concludes that these legal regimes have a role in protecting human rights but have not addressed the fundamental questions of democratic governance raised by this case.