6 ms·

Your assessment of my question isn't fair. Serving companies interests vs serving public interests isn't a dichotomy, and very rarely is a regulatory decision a

by aggronn 14y ago

Your assessment of my question isn't fair. Serving companies interests vs serving public interests isn't a dichotomy, and very rarely is a regulatory decision as clean cut as 'this is obviously bad and a net loss for the society, but we're going to let them set do it anyways'. Believing that to be the case is far more disingenuous. Regardless, moving between industry and regulatory bodies isn't necessarily done in a corrupt manner. If you're the president of a state energy board, you don't need to break any rules to get a higher paying job in industry. you're already, perhaps necessarily, more qualified than almost any other candidates. This is not inherently corrupt, this is what OP was referring to (or, this is a common meme which is associated with what he described).

dredmorbius 14y ago
No, it's accurate. What part of "when a state regulatory agency, created to act in the public interest, instead advances the commercial or special interests that dominate the industry or sector it is charged with regulating" don't you understand? That is the definition of "regulatory capture". Note that regulatory capture is not "balancing the public interest with commercial realities" or similar such wording. If you're perhaps debating some other term, please provide us with an accepted term and definition of same, rather than creating a Lewis Carrol "glory" (see: http://sabian.org/looking_glass6.php http://sabian.org/looking_glass6.php) and passing off as accepted wisdom. On my planet, the appearance of impropriety is considered largely as bad as actual impropriety. Taking an example from a US government website: http://ig.navy.mil/Complaints/Complaints%20%20(Appearance%20of%20Impropriety).htm http://ig.navy.mil/Complaints/Complaints%20%20(Appearance%20... If the revolving door consistently operates between regulatory agencies and the organizations those agencies regulate, then yes, I'd say that this comprises systemic corruption.
- aggronn 14y ago
  It might suffice to say that 'regulatory capture' is used more broadly in economic literature than what the wikipedia article you're referencing leads on. Maybe not. We disagree fundamentally on the 'appearance of impropriety' comment here. I don't consider the reason for changing jobs to be so cut and dry. I don't see this moving onto a productive discussion.
  - dredmorbius 14y ago
    If you're finding an alternate definition, cite your reference.
kamaal 14y ago
>>Serving companies interests vs serving public interests isn't a dichotomy It actually is, many times. Especially when companies are ready to pay up any amount of bribe to get their job done. To give you an example. A manufacturer can sell, low quality transformers to electric board. This is goes against public interests. But at the same the manufacturer can argue he creating jobs by running a company, so he can cheat. >>If you're the president of a state energy board, you don't need to break any rules to get a higher paying job in industry. Regular job income is chicken feed for these people compared to the money they make in bribes, commissions etc.
- aggronn 14y ago
  I'm specifically not referring to bribes. That is undoubtedly corruption. >A manufacturer can sell, low quality transformers to electric board. This is goes against public interests. You're going to have to give more details than this in order to make that statement. Are they in a competitive market? Is someone picking winners? What effect does this have on prices? Moreover, is he creating jobs? How is that cheating?
  - kamaal 14y ago
    In India its pretty common to have this scenario. We call it the 'License Raj System'- http://en.wikipedia.org/wiki/Licence_Raj http://en.wikipedia.org/wiki/Licence_Raj Licenses for supplies, manufacturing, export, services etc. Heck nearly everything is controlled by licenses. Which are in turn issued by the government. The Net result is heavy bribes are paid to get licenses. And then bribes are paid to regulators to by pass violations. You might think lobbying and campaign funds are too much of corruption in US. Come to India, you have to pay bribe for everything and anything. To give you a specific scenario. Lets say you bid for a contract to build roads. Lets say you tar roads. Firstly this can be won only through if you are licensed contractors(You have to pay bribe to get one). Then tenders are allocated for the road construction, you have to pay commissions to get selected. Now after heavily bribing your way through all this. The only way you can make profit is by sacrificing quality. Therefore you now use low quality material. If saw you are asked to tar the road 8 inches, you do only 3 inches. You don't tar lanes. The quality of tar you use doesn't last one rainy season. Regulatory authorities are severely bribed to over look all this. This is the regular story in India, In nearly ever walk of life. This happens from birth to death. People even bribe for birth and death certificates, voter identification cards, passports. You name it, and there is corruption associated with it.

by aggronn 14y ago

dredmorbius 14y ago

No, it's accurate. What part of "when a state regulatory agency, created to act in the public interest, instead advances the commercial or special interests that dominate the industry or sector it is charged with regulating" don't you understand? That is the definition of "regulatory capture". Note that regulatory capture is not "balancing the public interest with commercial realities" or similar such wording. If you're perhaps debating some other term, please provide us with an accepted term and definition of same, rather than creating a Lewis Carrol "glory" (see: http://sabian.org/looking_glass6.php http://sabian.org/looking_glass6.php) and passing off as accepted wisdom. On my planet, the appearance of impropriety is considered largely as bad as actual impropriety. Taking an example from a US government website: http://ig.navy.mil/Complaints/Complaints%20%20(Appearance%20of%20Impropriety).htm http://ig.navy.mil/Complaints/Complaints%20%20(Appearance%20... If the revolving door consistently operates between regulatory agencies and the organizations those agencies regulate, then yes, I'd say that this comprises systemic corruption.

aggronn 14y ago
It might suffice to say that 'regulatory capture' is used more broadly in economic literature than what the wikipedia article you're referencing leads on. Maybe not. We disagree fundamentally on the 'appearance of impropriety' comment here. I don't consider the reason for changing jobs to be so cut and dry. I don't see this moving onto a productive discussion.
- dredmorbius 14y ago
  If you're finding an alternate definition, cite your reference.

kamaal 14y ago

>>Serving companies interests vs serving public interests isn't a dichotomy It actually is, many times. Especially when companies are ready to pay up any amount of bribe to get their job done. To give you an example. A manufacturer can sell, low quality transformers to electric board. This is goes against public interests. But at the same the manufacturer can argue he creating jobs by running a company, so he can cheat. >>If you're the president of a state energy board, you don't need to break any rules to get a higher paying job in industry. Regular job income is chicken feed for these people compared to the money they make in bribes, commissions etc.

aggronn 14y ago
I'm specifically not referring to bribes. That is undoubtedly corruption. >A manufacturer can sell, low quality transformers to electric board. This is goes against public interests. You're going to have to give more details than this in order to make that statement. Are they in a competitive market? Is someone picking winners? What effect does this have on prices? Moreover, is he creating jobs? How is that cheating?
- kamaal 14y ago
  In India its pretty common to have this scenario. We call it the 'License Raj System'- http://en.wikipedia.org/wiki/Licence_Raj http://en.wikipedia.org/wiki/Licence_Raj Licenses for supplies, manufacturing, export, services etc. Heck nearly everything is controlled by licenses. Which are in turn issued by the government. The Net result is heavy bribes are paid to get licenses. And then bribes are paid to regulators to by pass violations. You might think lobbying and campaign funds are too much of corruption in US. Come to India, you have to pay bribe for everything and anything. To give you a specific scenario. Lets say you bid for a contract to build roads. Lets say you tar roads. Firstly this can be won only through if you are licensed contractors(You have to pay bribe to get one). Then tenders are allocated for the road construction, you have to pay commissions to get selected. Now after heavily bribing your way through all this. The only way you can make profit is by sacrificing quality. Therefore you now use low quality material. If saw you are asked to tar the road 8 inches, you do only 3 inches. You don't tar lanes. The quality of tar you use doesn't last one rainy season. Regulatory authorities are severely bribed to over look all this. This is the regular story in India, In nearly ever walk of life. This happens from birth to death. People even bribe for birth and death certificates, voter identification cards, passports. You name it, and there is corruption associated with it.