Authority Capacity Collapse and Regulatory Substitution in Complex Systems

Roshan Ghadamian
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Roshan Ghadamian: Institute for Regenerative Systems Architecture

IRSA Working Papers from Institute for Regenerative Systems Architecture

Abstract: Regulatory failure is usually explained by capture, under-resourcing or poor design. Those explanations do not account for the most common pattern: a regulator that retains its mandate, its expertise and its independence, and progressively stops exercising judgement — substituting rules, metrics, thresholds and procedures for the discretion it still formally holds. This paper states that pattern as an invariant. Under pressure, regulatory mechanisms that operate at a faster rate reliably displace slower endogenous authority, independent of intent, values or governance quality. What unites the substitutes — law, capital, metrics, algorithms, checklists, moral framing — is not their content but their speed, determinacy and defensibility relative to judgement. Three consequences follow. Substitution exhibits hysteresis: it persists after the pressure that produced it has abated, so collapse and recovery are asymmetric. It invites the optimisation paradox: substitutes are refined and scaled because doing so is locally rational, which entrenches the substituted regime and makes endogenous capacity harder to reconstitute. And it is accelerated by renewal dependency, where essential resources must be repeatedly re-secured under evaluative scrutiny. âš ï¸ The invariant is stated over a symptom. Substitution is what authority scarcity looks like rather than what causes it, so a regularity observed here predicts the surface and not the mechanism — which is why remedies aimed at the substitute relieve the symptom and the substitution returns in another form.

Keywords: regulatory substitution; authority capacity; substitution invariant; authority hysteresis; optimisation paradox; insulation; renewal dependency; rate mismatch (search for similar items in EconPapers)
JEL-codes: D02 D73 D83 K23 L51 (search for similar items in EconPapers)
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Persistent link: https://EconPapers.repec.org/RePEc:evk:wpaper:authority-capacity-collapse

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