Brief book review – Managing Regulation: Regulatory Analysis, Politics and Policy

Martin Lodge and Kai Wegrich, 2012, Palgrave Macmillan, 276 pages.

In Managing Regulation: Regulatory Analysis, Politics and Policy, Professor Martin Lodge (London School of Economics) and Professor Kai Wegrich (Hertie School of Governance) introduce regulatory analysis as a multidisciplinary perspective to consider problems in regulation and systematically explore the different regulatory strategies to address them. To the authors, the aim of regulatory analysis is not to provide expert insight and knowledge of a specific policy area but to provide expert insight and knowledge of the regulatory responses that cut across policy areas. As they argue: “when taking a regulatory analysis perspective [ask] the question: what underlying mechanisms make this particular approach achieve desirable results?” (p. 8).

The book is targeted at students of regulation and regulatory practitioners. This is never an easy combination of audiences to write for, but Lodge and Wegrich manage to serve both audiences well. The first half of the book introduces readers to the basics of regulatory theory and practice—that is, theories of regulation, standard-setting, monitoring and enforcement, and alternatives to classic command and control regulation. These chapters are all brief enough to be considered ‘introductions’ to specific topics for students new to regulation, but at the same time provide enough examples and depth about the pros and cons of various regulatory strategies and tools to be of interest to practitioners with many years of field experience.

The second half of the book addresses more contemporary issues in regulatory theory. It is here where the book, perhaps, is of most interest to regulatory practitioners. It deals with normative debates of and real-world experiences with international regulation, ‘better regulation’ and risk-based regulation. For a New Zealand audience of regulatory practitioners, particularly the chapter on better regulation will be of interest. This debate is about a whole-of-government approach to the quality of regulation and builds on many of the normative foundations that the New Zealand approach to regulatory stewardship builds on also. In a nutshell, better regulation seeks to address the problems experienced with command and control regulation, to reduce compliance costs and the administrative burden for citizens and business, and to reduce monitoring and enforcement costs for the government. It is partly about setting second-order regulation to govern how regulation should be developed, implemented, assesses, and, if necessary, terminated.

The conclusion touches on challenges central to regulatory practice: (i) an oversight deficit and lack of consistency in regulation across government agencies; (ii) a participation deficit of laypeople and experts in the development of regulation; (iii) an adaptability deficit of regulation to deal with an ever-changing context; and, (iv) a deficit in regulation to provide the right incentives to achieve compliance. These problems are as current today as they were at the start of the 2010s when the book was published. To help to address these problems, the core task of regulatory analysis as presented by Lodge and Wegrich is “first of all, to distil actual regulatory problems to the key analytical concerns and to develop different potential solutions. In a second step, then, these insights need to be considered in the light of the actual institutional and political opportunities and constraints” (p. 252).

Disclaimer In these brief book reviews, I discuss classic and contemporary books that make up the canon of regulatory scholarship. I focus on their central guiding idea or core notions and aim to keep the reviews to around 500 words. Unfortunately, this implies I must sacrifice a considerable amount of detail from the books reviewed.

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