Introduction
Introduction
What is the first thing you do when you wake up in the morning? Perhaps it goes something like this. You check your phone for the latest social media updates. After scrolling through short videos on TikTok and Instagram selected especially for you, you get up, determined to master your morning routine. You choose a yoghurt with nutritional label 'A', which stands for 'low fat' and 'no added sugar'. However, you notice that the 'best before' date on the carton has passed. On opening, the yoghurt smells and looks fine, but you throw it away, figuring that it's not worth taking unnecessary risks. As you head into the shower, you notice that your shower gel label says 'no microplastics' and that 'this package was made of recyclable plastic'. You take pride in living in an ecologically sustainable manner, doing your bit to address the climate crisis. During your cycle to work, you stop at a red traffic light, even though there is no traffic today. You wonder why a traffic light is sited here, given that it appears to have little impact on improving traffic flow nor does it seem to improve community safety.
Do you ever wonder why social media companies are allowed to target you with personalised videos and advertisements? Or how food labels and certifications are produced and how much they actually affect people's consumption decisions? For example, why would you throw away food after the 'best before' date even though it seems safe to eat? Or why stop at a red light when there's no one else about? If you are concerned about the climate emergency, you might have pondered why there are numerous rules and regulations addressing these issues in great detail, yet governments appear rather reluctant to implement more demanding measures to combat climate change. These questions, and many more, can be understood as questions about regulation.
Contemporary life relies on regulation. The quality and safety of the water we drink, the food we eat, the air we breathe, the social media applications we use, the clothes we wear and the transportation that we rely on are regulated by multiple regulatory regimes. But society does not stand still, and regulation is expected to 'keep pace' with the needs and priorities of the communities it is ostensibly intended to serve. Hence, we routinely encounter debates about whether a given regulatory regime continues to be 'fit for purpose' or requires updating, often prompted by technological change, evolving social norms and greater awareness of forms of harms or other threats and 'risks' that enter public consciousness. As a result, affected stakeholders may call for new laws and regulatory measures where they previously did not exist. It is hardly surprising that academic research concerned with regulation is now a well-established, distinct field of scholarly inquiry. Yet acquiring a clear grasp of the content and contours of this work and the nature of its terrain remains difficult and daunting.
When the first edition of this book was published in two thousand seven, its primary aim was to address this problem. It sought to provide a map to help newcomers navigate the field and obtain a holistic understanding of its core features and its varied, wide-ranging terrain. Almost two decades later, policymakers and academic researchers engaged with specific regulatory policies remain poorly acquainted with the body of scholarship we refer to as 'regulatory governance studies' or more simply 'regulatory studies'. For example, ongoing debates about the regulation of digital technologies, social media content and environmental degradation rarely draw upon insights from this literature. Although the regulation of artificial intelligence, for example, now routinely makes newspaper headlines, accompanied by a proliferation of academic and policy papers, many misunderstandings remain regarding whether and why we should regulate, when, how and by whom. Regulation is ultimately a multi- and interdisciplinary endeavour. Regulatory governance scholarship grows out of many disciplines, variously seeking, for example, to understand human welfare; social norms; human psychology; the nature, magnitude and character of risks; the influence of changes to legal rights and duties and political and institutional cultures and their interaction. This is a complex and challenging ambition, which is arguably more important now than ever. By drawing together material from a range of disciplinary perspectives from the humanities and social sciences, including law and public administration, interleaving them with our accessible commentary, we wish to introduce all newcomers to the study of regulation whatever the source of their curiosity, prior disciplinary background or motivation.
Regulation in Historical Context
Regulation in Historical Context
The origins of regulatory governance scholarship began in the United States where the phenomenon of regulation has been most extensively studied thanks to its early embrace of the 'independent regulatory agency'. During the late nineteenth century, pressures from rapid industrialism, urbanisation and its economic disruption, all linked to long-distance transportation (particularly the railroad firms and their practices) and interstate commerce, prompted calls for national political leadership and a permanent concentration of government controls. The Sherman Act was passed in eighteen ninety as a response to the nineteenth century 'curse of bigness' that affected a number of economic sectors. This statute prohibited trusts, monopolies and cartels in order to promote economic fairness and competitiveness. The independent regulatory agency became the favoured institutional model for responding to these concerns, forming the basis upon which the Interstate Commerce Commission, eighteen eighty-seven, the Federal Reserve Board, nineteen thirteen, and the Federal Trade Commission, nineteen fourteen, were established.
During the early nineteen thirties, the number of regulatory agencies grew rapidly as part of 'New Deal' reforms enacted to address the crippling impact of the Great Depression, along with the expansion of the federal administration, reflecting an optimistic belief in their ability to provide for the efficient functioning of economic processes. This set of revolutionary regulatory measures, much like other key moments in the history of regulation that would follow, was the immediate response to the Great Depression, a global economic crisis that prompted the federal government to rethink its position in relation to markets. The Stock Market Crash of nineteen twenty-nine is widely regarded as one of the principal triggers of this crisis. By the early nineteen seventies, regulatory activity and the remit of these regulatory agencies widened as public interest in health, safety, environmental preservation and social inequality spawned a wave of regulatory reform in fields as diverse as motor vehicle safety, product design, air and water pollution, occupational health and safety and many others. However, a few years later, regulatory agencies had fallen out of favour, perceived by many as mired in legalism and bureaucracy. The regulatory landscape had become too complex and, in some cases, inefficient and burdensome to those subjected to regulatory oversight. Regulatory requirements were often in conflict. This was accompanied by a general distrust of government intervention in the economy, fuelled by the ideology of neoliberalism rooted in a belief in the superiority of market forces. This gave rise to a strong 'deregulatory' impulse, reflected in a raft of measures introduced by the Reagan Administration, nineteen eighty-one to nineteen eighty-nine, to relieve business from the regulatory burdens and making public administration more responsive to citizen's demands via sensitivity to market forces.
The early emergence, longevity and breadth of authority vested in independent regulatory agencies readily explains why regulation has been well-studied in the US context, tightly linked to the study of US Federal 'administrative law'. In contrast, independent regulatory agencies emerged in the United Kingdom and Europe much later, beginning in the late nineteen seventies and early nineteen eighties. In the United Kingdom, their emergence was precipitated by the privatisation of state-owned enterprise under the Thatcher administration as the institutional vehicle through which government oversight over these industries was retained alongside a raft of other 'quangos' (quasi-autonomous government organisations). At roughly the same time, the drive for internal market integration gathered steam as the European Union matured and the role of the European Commission, its administrative arm, grew in size, stature and authority. In the U.S., British and E.U. contexts, sustained criticisms have been levelled at a perceived 'democratic deficit' and an associated 'crisis' in accountability arising from allowing unelected bureaucrats to make decisions that affect the wider public in which some gain while others are made worse off. In Asia, Africa and South America, the rise of regulation is more recent and has often been driven by the conditions attached to international investment law and economic development loans from the World Bank and International Monetary Fund, the influence of the OECD and other international organisations concerned to foster and promote international trade and the need to comply with E.U. regulations to gain access to lucrative E.U. markets. Despite their varied trajectories, each can be understood as specific instantiations of the 'regulatory state'.
The idea of the 'regulatory state' was developed in the nineteen nineties, referring to a particular institutional and policy style as the frontiers of the state were rolled back and the state substantially reduced its involvement in the direct provision of welfare and as an employer or property owner. These transformations did not, however, result in the disappearance of the state but a shift in central function, one from 'rowing' to 'steering' as Osborne and Gaebler's well-chosen metaphor implies. Although the larger economic, political and technological context in which regulatory states operate have changed significantly since then, its central regulatory function remains omnipresent. Despite substantial differences in their particular institutional forms, cultures and practices, what unites these regulatory states is an underlying belief that 'politics' and 'administration' can be separated, the latter being a 'science' that could be entrusted to 'experts' and thus insulated from electoral politics.
A second and related theme that has emerged within regulatory states throughout the world is a growing preoccupation with 'risk'. Within academic literature, the regulatory state must now contend with the challenges of the 'risk society', referring to the claim of German sociologist Ulrich Beck that technological advances have produced risks that are industrial in scale and global in their impacts, affecting collective risks that individuals cannot mitigate through unilateral action. Accordingly, the state remains risk protector of last resort, expected to undertake organised attempts to manage risks to collective welfare. Although states often look to scientific experts for guidance, with its promise of political 'neutrality' and objectivity, they soon discover that what counts as a 'risk', and how best to understand its nature or severity, rarely attracts widespread community consensus. The impossibility of escaping politics and the dynamic interplay of power between competing actors, groups and organised interests, constitutes a third feature of regulatory debate. In other words, despite attempts to portray regulatory policy as a mundane, technocratic endeavor, in reality regulators (whether they are public or private bodies) wield tremendous power. Yet this does not necessarily imply that governments always have the stronger hand, capable of intervening in the economy at will and obstructing freedom to innovate. The reality is more complex. Many private parties (e.g., multinationals, Big Tech firms) have considerable political and economic power, strategically seeking to influence regulatory policy, while often undertaking regulatory functions themselves. The regulatory landscape thus comprises a complex and often overlapping web of players, institutions, interests and power dynamics, interacting in larger regulatory networks. This messy reality exacerbates challenges of communication, coordination and control, while making the task of holding those wielding regulatory authority to account even more difficult. For example, during the COVID-nineteen pandemic, coordination between the World Health Organisation, a global health regulator, with national and local public health authorities was characterised by multiple miscommunications and ineffective coordination producing contradictory information, confusion and the dissemination of inaccurate information. As this book unfolds, we observe a persistent tension between two central commitments: on the one hand, a belief in 'rational' regulatory decision-making and regulation informed by scientific knowledge and expert judgement and, on the other, the recognition that regulatory policies and decisions reflect political judgements about individual and collective rights, interests and duties in which active participation, particularly by those directly affected, is required if those policies and decisions are to be considered democratically legitimate.