Theory: Zaring on networks of regulators

David Zaring (Wharton School of Business) has posted a draft paper on networks of regulators, "Why do some networks fail and others succeed?  A case study in financial regulation",  prepared for the Georgia Law School Workshop, 2/19/09.   This paper describes and analyzes the effectiveness of several international networks, of greater and lesser formality, in which the U.S. Securities and Exchange Commission has participated.  He comes up with some counterintuitive conclusions.

While this is more of a political science study than a legal study, it provides a useful perspective on how regulators at the same level of government can work synergistically.  I suggest it is important to recognize that the process Zaring describes at the international level happens at lower levels as well (e.g., county associations of municipal governments).  Recognized but not emphasized in this paper is the effect of different interests at different levels of government.  For example, municipal governments within a county may have interests in common that conflict with the interests of the county government.  The reasons for this can range from partisan politics to NIMBY self-interest.  Zaring's paper is quick and well-documented, with minimal B-school-speak.  EMM