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Considerations for the Design and Transformation of Regulatory Systems

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  • Castaneda, Araceli
  • Phillips, Michele
  • Jamison, Mark

Abstract

We examine the motivations for forming regulatory agencies and the features that are critical for their success. Governments create independent regulatory agencies to address two fundamental problems in the control of public utilities, namely the dampening effect that politics has on investment and the value of specialized knowledge. Agencies are more effective in stimulating investment if they are insulated from political pressures to behave opportunistically and if they have sufficient resources to overcome information asymmetries with operators. Forming or reforming regulatory systems create adaptive challenges for those whose authority, influence, and traditions are affected. Trained leadership professionals are often needed to help stakeholders through these transitions.

Suggested Citation

  • Castaneda, Araceli & Phillips, Michele & Jamison, Mark, 2014. "Considerations for the Design and Transformation of Regulatory Systems," MPRA Paper 113243, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:113243
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    File URL: https://mpra.ub.uni-muenchen.de/113243/1/MPRA_paper_113243.pdf
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    References listed on IDEAS

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    Cited by:

    1. Antonio Estache, 2016. "Institutions for Infrastructure in Developing Countries: What We Know and the Lot We still Need to Know," Working Papers ECARES ECARES 2016-27, ULB -- Universite Libre de Bruxelles.

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    More about this item

    Keywords

    Regulation; Energy; Natural Monopoly; Public Utility; Leadership;
    All these keywords.

    JEL classification:

    • K23 - Law and Economics - - Regulation and Business Law - - - Regulated Industries and Administrative Law
    • L51 - Industrial Organization - - Regulation and Industrial Policy - - - Economics of Regulation
    • L94 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Electric Utilities

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