Regulatory capitalism and its discontents: Bilateral interdependence and the adaptability of regulatory styles

The expansion of global trade has produced new challenges for the effective governance of product safety. We argue that many of these challenges arise at the bilateral level from the interaction of more or less adaptable national regulatory styles. When regulatory styles are unadaptable they produce gaps in risk management, slow and contested resolutions to crises, and limited regulatory cooperation. To examine these claims empirically, we study bilateral food safety regulation in four major exporter–importer dyads: China–Japan; Canada–United States (US), China–European Union (EU), and the US–Japan. The China–Japan dyad is the most adaptable, combining China's “export segmentation” regulatory style with Japan's strongly “risk‐averse, interventionist” style. The Canada–US dyad operates effectively, bringing together Canada's “global market–conforming” regulatory style with the US strategy of “sovereign regulator.” The China–EU dyad is less adaptable because the EU's “harmonization” regulatory style makes it difficult for the EU to adapt to the weaknesses of the Chinese food safety system. Finally, the US's sovereign regulator style clashes with Japan's interventionist style, making them the least adaptable of the four dyads. The paper concludes with a discussion of the broader relevance of our findings for the development of regulatory capitalism.