Regulatory competition in capital standards: a ‘race to the top’ result

Conclusion

Law for Sale ◽

10.1093/oso/9780198839491.003.0007 ◽

2019 ◽

pp. 175-182

Author(s):

Johanna Stark

Keyword(s):

Race To The Top ◽

Competitive Dynamics ◽

Regulatory Competition ◽

Nation State ◽

Global Integration ◽

Legal Standards ◽

The Many ◽

And Function ◽

Globalized World

The final chapter summarizes the arguments of the book that have exposed the ‘philosophical externalities’ of regulatory competition. If taken seriously as an interpretive framework of law production and reform, regulatory competition commits us to an understanding of law that is inconsistent with other views about law and its role in society that we appear to hold. What does not follow from these arguments is that regulatory competition and the resulting law markets are, in any possible scenario, inherently bad. It would be utopian to assume that the clock on the structural preconditions that have led to competitive dynamics in several areas of law could simply be turned back. To a significant extent, regulatory competition is one of the many symptoms of globalization. The global integration of political, legal, and economic spheres in numerous ways calls into question the role and impact of the nation state. What you think about regulatory competition therefore may not depend so much on the plausibility of its resulting in a race to the top or the bottom in legal standards, but on what you think about the purpose and function of the state in a globalized world.

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The Economic Case for Regulatory Competition

Law for Sale ◽

10.1093/oso/9780198839491.003.0003 ◽

2019 ◽

pp. 57-70

Author(s):

Johanna Stark

Keyword(s):

Efficient Solutions ◽

Race To The Top ◽

Regulatory Competition ◽

Negative Externalities ◽

Economic Perspective ◽

Race To The Bottom ◽

Selection Principle ◽

Legal Rules

This chapter discusses arguments in favour of and against regulatory competition—and systems competition—from an economic perspective. The first strand of positive arguments refers to the merits of competition in general, in the Hayekian sense of a discovery procedure for efficient solutions in situations of dispersed and undisclosed knowledge. Competition among suppliers of legal products—the argument goes—should help to identify and establish efficient legislative solutions. The second type of argument builds upon the premise that regulatory competition serves as a restraining factor against the Leviathan state. Competitive structures based on credible exit threats by law’s addressees could force governments to consider the interests of legal customers instead of, for example, taxing excessively. The chapter proceeds with a discussion of arguments that have questioned the promise of regulatory competition from an economic perspective, such as the selection principle. The most prominent criticism is that regulatory competition brought about by a law market leads to a ‘race to the bottom’ instead of a ‘race to the top’ in the quality of legal rules, such as a ‘race to laxity’ in the case of mandatory standards designed to prevent negative externalities.

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The “Peer-Effect” in Counterterrorist Policies

International Organization ◽

10.1017/s0020818313000362 ◽

2014 ◽

Vol 68 (1) ◽

pp. 211-234 ◽

Cited By ~ 20

Author(s):

Eric Neumayer ◽

Thomas Plümper ◽

Mariaelisa Epifanio

Keyword(s):

Empirical Analysis ◽

Spatial Dependence ◽

Peer Group ◽

Race To The Top ◽

Regulatory Competition ◽

International Terrorism ◽

Negative Externalities ◽

Terror Attack ◽

Developed Country ◽

Peer Effect

AbstractExisting accounts posit that defensively oriented counterterrorist policies create negative externalities and result in regulatory competition that induces governments to increasingly tighten their policies. We argue that rather than causing an unconditional global “race to the top,” spatial dependence in counterterrorist policies is limited to within groups of countries exposed to a similar level of threat from international terrorism. Countries strongly differ in their propensity to become the target of an international terror attack. Governments can safely ignore counterterrorist policies enacted by countries outside their “peer group,” but they must pay attention to measures undertaken by their peers. We test several predictions derived from our theory in an empirical analysis of counterterrorist regulations in twenty Western developed-country democracies over the period 2001 to 2008.

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