Accountability in Government and Regulatory Policies: Theory and Evidence

Carmine Guerriero

No 37849, Privatisation Regulation Corporate Governance Working Papers from Fondazione Eni Enrico Mattei (FEEM)

Abstract: This paper analyzes the political economy of regulatory and judicial appointment rules. I study a model of price-setting by a political principal faced with a firm with unknown costs, and endowed with an information-gathering technology whose efficiency rises with the effort exerted by two accountable supervisors (a regulator and a judge). This set-up captures the institutions of several international markets. The model predicts that reforms toward election rather than appointment of regulators are more likely the less efficient is the information-gathering technology, the less stringent are the investment concerns of society, the stronger are regulators’ revolving-door motivations, and the closer is political competition. These predictions are consistent with US electric power market data. Moreover, in accordance with the model, electricity rates are lower and respond less to shock in input costs in states that elect their regulators or their High Court judges.

Pages: 52
Date: 2008-06
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://ageconsearch.umn.edu/record/37849/files/55-08a.pdf (application/pdf)

Related works:
Journal Article: Accountability in government and regulatory policies: Theory and evidence (2011)
Working Paper: Accountability in Government and Regulatory Policies: Theory and Evidence (2008)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ags:feempr:37849

DOI: 10.22004/ag.econ.37849

Access Statistics for this paper

More papers in Privatisation Regulation Corporate Governance Working Papers from Fondazione Eni Enrico Mattei (FEEM) Contact information at EDIRC.
Bibliographic data for series maintained by AgEcon Search ().