The Oxford Handbook of Regulation

Citation

Baldwin, R., Cave, M., & Lodge, M. (Eds.). (2010). The Oxford Handbook of Regulation. Oxford University Press.

Chapter Summary

Context and Scope

This is an edited reference volume of 25 contributions by different authors, published in 2010. The publisher describes it as a discussion of the major trends and issues in regulation over the previous thirty years with an outline of prospective developments. It treats regulation as something that can enable markets as well as restrict behaviour, draws on experience from several jurisdictions and on several disciplines, and gives particular attention to the problems that arise when approaches are applied in practice. The contributions are grouped below by theme, in the order of the volume.

Introduction and Foundations (Chapters 1–4)

• Introduction: Regulation—the Field and the Developing Agenda (Baldwin, Cave, Lodge). Argues that regulation has become central to contemporary social life and has remained a moving target in both practice and study, no longer confined to dedicated command regimes.
• Economic Approaches to Regulation (Veljanovski). Reviews economic theories of regulation and how economics has been used to design and evaluate it, covering economic and social regulation, competition law and the economics of the legal system.
• Regulatory Rationales Beyond the Economic: In Search of the Public Interest (Feintuck). Contends that regulation should reflect social and political values beyond market economics, with examples from environmental and media regulation.
• The Regulatory State (Yeung). Examines its defining features, explanations for its emergence, the paths taken in the United States and the United Kingdom, and the tension between technocratic and political images of regulation.

Processes and Strategies (Chapters 5–9)

• Strategic Use of Regulation (Veljanovski). Looks at how industry and regulators use regulation strategically, and at rules that limit wasteful attempts to game the system.
• Standard-Setting in Regulatory Regimes (Scott). Explains what standards are, the range of state and non-state actors who set them, and the accountability problems of diffuse standard-setting.
• Enforcement and Compliance Strategies (Gunningham). Reviews the debate on whether regulators should punish or persuade, from responsive regulation to smart regulation.
• Meta-Regulation and Self-Regulation (Coglianese, Mendelson). Defines these alternatives to command-and-control regulation and assesses their strengths and weaknesses.
• Self-Regulatory Authority, Markets, and the Ideology of Professionalism (Rostain). Uses the American legal profession to explain the logic of professional self-regulation and the pressures on it.

Contested Issues (Chapters 10–17)

• Alternatives to Regulation? Market Mechanisms and the Environment (Driesen). Compares traditional environmental regulation with market-based instruments and their dependence on government design and enforcement.
• The Evaluation of Regulatory Agencies (Stern). Surveys methods for evaluating the outcomes of infrastructure regulators, including case studies and econometric analysis.
• Better Regulation: The Search and the Struggle (Baldwin). Examines efforts to improve regulation and the challenges of benchmarks, strategies and measurement.
• Regulatory Impact Assessment (Radaelli, De Francesco). Reviews the theory and evidence on this appraisal tool, comparing the United States and Europe.
• The Role of Risk in Regulatory Processes (Black). Argues that risk plays four roles in regulation and that each tends to destabilise decision-making.
• Accountability in the Regulatory State (Lodge, Stirton). Treats accountability as a continuing tension among competing values, in a context of decentred regulation.
• On the Theory and Evidence on Regulation of Network Industries in Developing Countries (Estache, Wren-Lewis). Identifies capacity, commitment, accountability and fiscal limits and the policy options they leave.
• Global Regulation (Koenig-Archibugi). Considers how external and global factors shape national regulatory policy.

Regulatory Domains (Chapters 18–24)

• Financial Services and Markets (Moloney) covers the rationales for financial regulation and its repeated reform; Pricing in Network Industries (Hauge, Sappington) covers cost-based and incentive regulation and access pricing; Regulation and Competition Law in Telecommunications and Other Network Industries (Alexiadis, Cave) asks when competition law can replace sector regulation.
• Regulation of Cyberspace (Feick, Werle) discusses blurred lines between regulators and regulated; The Regulation of the Pharmaceutical Industry (Towse, Danzon) the effects of patents, moral hazard and access; Regulation and Sustainable Energy Systems (Mitchell, Woodman) the role of energy regulators in sustainability goals.
• Regulation Inside Government: Retro-Theory Vindicated or Outdated? (Lodge, Hood) scrutinises oversight of the public sector itself.

Conclusion (Chapter 25)

• The Future of Regulation (Baldwin, Cave, Lodge). Takes the financial crisis as an opportunity to rethink regulation and argues for more cross-disciplinary research.

Key Concepts

Foundations and Strategies

• Regulatory state: a form of state organised around rule-making, oversight and incentive instruments rather than direct provision.
• Responsive and smart regulation: enforcement strategies that combine persuasion and sanctions according to the regulated party's behaviour.
• Meta-regulation and self-regulation: alternatives to command-and-control rules in which regulated organisations regulate themselves, with oversight.

Contested Issues

• Better regulation and regulatory impact assessment: government programmes and appraisal tools to improve regulatory quality.
• Risk as an organising principle: the way risk frames objects, justifications and accountability in regulation.
• Accountability: demands made of regulators that conflict with one another and change over time.

Domains

• Network industries: sectors such as electricity, telecommunications and water, where price and access regulation are central.
• Market mechanisms: instruments such as trading schemes used as alternatives to prescriptive rules.

Critical Analysis

Strengths

• Breadth with named expertise. Each chapter is written by a different specialist, from economics, law, political science and public administration, and each states its own perspective.
• Combines themes and domains. The volume pairs cross-cutting questions (accountability, risk, enforcement) with chapters on specific sectors, so the same ideas can be seen at work in several fields.
• Attention to practice. The publisher notes that contributions give particular attention to challenges that arise when approaches are applied in practice.
• Open about change. The introduction and conclusion frame regulation as a moving field and, in the final chapter, draw on the financial crisis to suggest where research should move.

Limitations

• Not a single narrative. As a handbook, it works best as a reference for chapters, and a reader seeking one continuous introduction will need another book.
• Uneven level. Each chapter is an independent essay, so vocabulary and technicality vary, from economic models of pricing to the sociology of professions.
• Dated. It appeared in 2010, just after the financial crisis; developments since then are outside its scope.
• Selective domains. The sector chapters cover finance, networks, cyberspace, pharmaceuticals and energy, which leaves out many other regulated fields.

Where It Fits in the Course

On this list the editors' own textbook, Baldwin, Cave and Lodge's Understanding Regulation, is the natural first read for the theory and practice of regulation, and the Handbook goes beyond it with specialist essays by many authors. The remaining books belong to competition law: Whish and Bailey's Competition Law, Jones and Dunne's Jones & Sufrin's EU Competition Law and Hovenkamp's The Antitrust Enterprise (United States).

Read the Handbook after a general text and alongside the competition books, particularly the chapters on competition law and network industries.

How to Use This Book

It is a graduate-level reference for students of regulation, public policy or economic law. A prior course in regulation or competition law helps. Read the Introduction first, then pick chapters by interest rather than from cover to cover. The foundation chapters (2 to 4) and the process chapters (5 to 9) suit a general course. For a project on a sector, pair the relevant chapter from 18 to 23 with one cross-cutting chapter such as risk or accountability. Finish with Chapter 25 for the editors' view of what is unresolved.