Government and Markets:
Toward a New Theory of Regulation
After two generations of emphasis on governmental inefficiency and the need for
deregulation, we now see growing interest in the possibility of constructive governance,
alongside public calls for new, smarter regulation. Yet there is a real danger that
regulatory reforms will be rooted in outdated ideas.
As the financial crisis has shown, neither traditional market failure models nor public
choice theory, by themselves, sufficiently inform or explain our current regulatory
challenges. Regulatory studies, long neglected in an atmosphere focused on deregulatory
work, is in critical need of new models and theories that can guide effective
policy-making.
This interdisciplinary volume points the way toward the modernization of regulatory
theory. Its essays by leading scholars move past predominant approaches, integrating the
latest research about the interplay between human behavior, societal needs, and regulatory
institutions.
The book concludes by setting out a potential research agenda for the social sciences.
Introduction Edward Balleisen Balleisen, Edward
David Moss Moss, David 1
Sect. I Beyond Market Failure
1 Government Failure vs. Market Failure:
Principles of Regulation Joseph E. Stiglitz Stiglitz, Joseph E. 13
2 Effective Regulation through Credible
Cost-Benefit Analysis: The Opportunity Costs of Superfund Michael Greenstone
Greenstone, Michael 52
3 From "State Interference" to the
"Return to the Market": The Rhetoric of Economic Regulation from the Old Gilded
Age to the New Mary O. Furner Furner, Mary O. 92
4 Lessons from Europe: Some Reflections on
the European Union and the Regulation of Business Neil Fligstein Fligstein, Neil
143
5 Confidence Games: How Does Regulation
Constitute Markets? Daniel Carpenter Carpenter, Daniel 164
Sect. II Beyond the Economic Theory of
Politics
6 The End of Special Interests Theory and
the Beginning of a More Positive View of Democratic Politics Donald Wittman
Wittman, Donald 193
7 Public Choice: A Critical Reassessment
Jessica Leight Leight, Jessica 213
8 The Paranoid Style in the Study of
American Politics David A. Moss Moss, David A. Mary Oey Oey, Mary 256
9 Law, Policy, and Cooperation Yochai
Benkler Benkler, Yochai 299
Sect. III Beyond Command and Control
10 What Opportunity Is Knocking? Regulating
Corporate Governance in the United States Mary A. O'Sullivan O'Sullivan, Mary A.
335
11 Taxation as a Regulatory Tool: Lessons
from Environmental Taxes in Europe Monica Prasad Prasad, Monica 363
12 Redesigning Regulation: A Case Study from
the Consumer Credit Market Elizabeth Warren Warren, Elizabeth 391
13 Origins and Regulatory Consequences of
the Subprime Crisis Barry EichengreenEichengreen, Barry 419
14 The Prospects for Effective Coregulation
in the United States: A Historian's View from the Early Twenty-First Century
Edward J. Balleisen Balleisen, Edward J. 443
15 Deregulation Theories in a Litigious
Society: American Antitrust and Tort Tony Freyer Freyer, Tony 482
16 Markets in the Shadow of the State: An
Appraisal of Deregulation and Implications for Future Research Marc Alien Eisner
Eisner, Marc Alien 512
Conclusion Edward J. Balleisen Balleisen, Edward J.
David A. Moss Moss, David A. 538
576 pages, Paperback