Industry self-regulation, subversion of public institutions, and social control of torts

Peter Grajzl and Andrzej Baniak

International Review of Law and Economics, 2009, vol. 29, issue 4, 360-374

Abstract: We characterize the comparative efficiency of industry self-regulation as means of social control of torts. Unlike liability, which is imposed by courts ex post, industry self-regulation, much like government regulation, acts before the harm is done. As compared to government regulators, however, the industry regulates with superior information. Furthermore, a pro-industry bias inherent to self-regulation also arises under alternative institutional arrangements when adjudicators are vulnerable to pressure by industry members. We show when industry self-regulation is socially desirable and feasible, and clarify when it could be an attractive institutional arrangement for developing and transition countries.

Keywords: Industry; self-regulation; Social; control; of; torts; Institutional; subversion; Strict; liability; Government; regulation; Industry; hazardness (search for similar items in EconPapers)
Date: 2009
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Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:irlaec:v:29:y:2009:i:4:p:360-374

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