Regulatory Capture

Regulatory capture is a form of political corruption in which a regulatory agency acts on behalf of the industry it regulates instead of for the public interest that it is supposed to protect, through the political capture of the agency by the regulated industry. Here, responsible authorities act to allow and conceal the illegal practices they are charged to prevent. The problem is greatly exacerbated by two related factors: (1) the agencies’ information and expertise are provided by experts, usually from the regulated industry, and (2) a “revolving door” of appointments exists between the industry and the agency, encouraging a close alignment of interests. Quis custodiet ipsos custodes? (Who will protect us from our protectors?)

According to neoliberal views, regulatory capture is an anomalous departure from ...