Source
Schram, A. & Ule, A. (2024), LIT-1340, §5: “regulatory independence is beneficial when policymakers favor consumers but may be detrimental if they favor the industry”, and “if the regulatory interests align with infrastructure operators, a flexible regulator may be more efficient.” Read in NOTE-1053.
What was actually shown
A stylized game with equilibria for two boundary cases of voting (the paper’s Table 2, derived in an appendix this reading did not check), and the laboratory result THEORY-856. Both bear on the account only for a regulator whose independence is a price fixed at the start, with policymakers’ alignment assigned.
What this does not say
- Not that independent agencies are captured more often. The paper cites the worry that independence raises “the chance of its capture by the industry”, and does not test it.
- Not that political control is better. The account is conditional on the designers’ alignment, and the authors’ own result is that without capture independence helps.
- Not that electoral pressure corrects capture. In the lab it was partial, and the authors expect it to be weaker in real elections.
Connections
- CLAIM-404. A route by which formal independence protects capture rather than evaluation: independence from one authority (voters) installed by an agent of another (the industry).
- CLAIM-410. Independence is a change in who holds revision. This account says the effect of removing the electorate’s share of revision depends on who held rule-making when it was removed.