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on Regulation |
| By: | Stephen C Littlechild; Harry Bush; Alan DA Sutherland; Gavin Knott; Andrew Walker |
| Keywords: | Negotiated settlements, customer engagement, energy regulation, water regulation, airports |
| JEL: | L51 L94 L95 L97 |
| Date: | 2026–08 |
| URL: | https://d.repec.org/n?u=RePEc:enp:wpaper:eprg2618 |
| By: | C Lennart Baumgärtner; Jorge Cárdenas Prieto; Cameron Hepburn, Robert A Ritz |
| Keywords: | Cost of equity, hurdle rate, infrastructure investment, idiosyncratic risk, regulation |
| JEL: | G11 G12 G31 H54 L94 Q48 |
| Date: | 2026–08 |
| URL: | https://d.repec.org/n?u=RePEc:enp:wpaper:eprg2620 |
| By: | Ricardo Perez-Truglia; Jeffrey Yusof |
| Abstract: | The rise of superstar firms has made dominant companies central to modern economic life, and antitrust enforcement is one of the main policy tools for regulating their market power. Public opinion can shape the political and regulatory environment in which antitrust enforcement takes place, yet there is little direct evidence on what drives these preferences. We conduct a pre-registered information-provision experiment with 4, 000 American households. Respondents were told about one of five real antitrust cases and randomly assigned to information treatments designed to study four potential drivers of support for antitrust enforcement: perceived market share, perceived consumer harm, perceived unfair competition, and perceived negative image. All four treatments moved the beliefs they were designed to affect, but their effects on demand for antitrust differed sharply. Information about consumer harm had the most systematic effects: it increased plaintiff support and support for break-up and conduct remedies, with effects remaining visible one month later, and also spilled over to broader support for antitrust policies. By contrast, and contrary to expert forecasts, information about market share had no meaningful effect on demand for antitrust enforcement. The findings suggest that the public thinks like economists in one key respect: they do not care about market share per se, but respond instead to consumer harm. One factor outside the core economic framework, perceived unfair competition, also matters, though its effects are more limited in scope. We discuss implications for policymakers and regulators. |
| JEL: | C90 D83 K21 L40 |
| Date: | 2026–07 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:35503 |
| By: | Díaz-Pastor, Santos J.; Liu, Yang; Pérez-Arriaga, Ignacio J. |
| Abstract: | This paper proposes a replicable regulatory and financial framework to achieve universal electricity access as a core component of a just energy transition in Sub-Saharan Africa. It argues that universal access is feasible under realistic constraints when electrification planning, tariff regulation, and capital mobilization are designed as one coherent system rather than separate workstreams. The analysis rests on a computational, multi-period financial model that integrates individual interacting sub-models for every actor in the distribution segment. Versions of the same overall approach are applied to three countries, spanning different starting points and sector structures. Uganda provides the reference implementation in the wake of an expiring private distribution concession; Zambia recalibrates the same logic to a distressed national utility and a thin domestic revenue base; and Madagascar—where the framework is already being applied—shows it moving from design to district-scale delivery in the lowest electricity access setting of the three. The central mechanism is an integrated national planning, regulatory, business, and financing architecture that coordinates grid extension, mini-grids, and stand-alone systems within a single distribution-level financial plan. The framework separates two gaps that are routinely mixed—the viability gap, the recurring shortfall between affordable tariff revenues and the regulated cost of service, and the financing needs, the timing mismatch between front-loaded investment and gradual cost recovery—and shows that they each call for a distinct instrument. The evidence indicates that universal access can be reached without permanent reliance on external grants, and that extending the access horizon rather than compressing investment improves feasibility while still reaching everyone—so that the design becomes a problem of finding an electrification target year, a pattern of overall subsidy, and tariffs that are just right, each neither too much nor too little. The paper reframes universal access as a challenge of cost allocation and institutional design, showing that affordability, inclusion, and financial sustainability are not competing objectives once electrification is designed as one system. |
| Date: | 2026–08–31 |
| URL: | https://d.repec.org/n?u=RePEc:wbk:wbrwps:11439 |
| By: | Langenbucher, Katja |
| Abstract: | How should legislators and regulators cope with technological innovation in the field of financial services? Move quickly, top-down, to provide legal certainty - or let things develop bottom-up, with decentralised legislators and agency initiatives preparing the ground? Over the last years, stablecoins, i.e., crypto assets that are framed as payment instruments and promise stability through a peg to underlying reserves, 2 have been a paradigm example for regulatory strategies and cultural differences between the U.S. and the EU. The U.S. has been inclined to take a bottom-up engagement, coupled with a distrust of government intervention, while the EU was more disposed towards quickly moving forward with comprehensive regulation, aimed at insulating financial consumers from anticipated harm. |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:safewh:343097 |
| By: | Federico D'Amario (Bank of England); Sebastian de-Ramon (Bank of England); William Francis (Bank of England) |
| Abstract: | Strong bank capitalisation provides long‑run financial‑stability benefits. However, transitioning to higher capital levels may involve short‑run costs. We analyse the effects of prudential capital changes on lending behaviour, macroeconomic outcomes, and banking competition using UK data within a structural VAR framework with sign and narrative restrictions. Narrative constraints draw on the UK regulator’s 2014–15 stress tests and the 2016 annual cyclical scenario. Impulse responses indicate that banks primarily adjust by reducing risk-weighted assets rather than raising new equity. Higher capital requirements entail negligible long-run costs, with modest short-run macroeconomic effects consistent with other VAR studies on bank capital. These impacts are driven by a contraction in lending and increase in spreads across sectors. We find that effects of altering prudential capital requirements are state dependent. Altering during recessions, as compared with expansions, amplifies short-run contractions, but these are more short-lived, with output recovering more quickly. Indicators of market power (Boone, HHI, Lerner) suggest that tighter capital requirements temporarily reduce banking competition. |
| Keywords: | Bayesian VAR models;narrative restrictions;financial stability;bank competition;state‑dependent local projections |
| JEL: | C11 C32 E32 G21 G28 |
| Date: | 2026–02–27 |
| URL: | https://d.repec.org/n?u=RePEc:boe:boeewp:023294 |
| By: | Dennis W. Carlton; John List; Allan Shampine; Hal Sider; Theresa Sullivan |
| Abstract: | The Federal Trade Commission ("FTC") brought an antitrust lawsuit against Meta in 2021, claiming that Meta's acquisitions of Instagram and WhatsApp had allowed it to monopolize a relevant market for apps providing "Personal Social Network Services" and that consumers had been harmed because the acquisitions allowed Meta to increase ad loads imposed on Facebook and Instagram app users. However, the FTC's market definition was not based on quantitative evidence and its assertion of harm ignored the two-sided nature of the Meta platforms, which makes it impossible to determine whether a merger would increase ad loads based on theory alone. In contrast, Meta's economic experts used modern theoretical and quantitative tools of economic analysis to address market definition and competition issues. This paper summarizes the field experiment, natural experiments, and related quantitative analyses presented by Meta's economic experts that demonstrated the FTC's market definition excluded apps that were closer substitutes to Meta's apps than the included apps. The paper also summarizes the results of a demerger simulation that accounted for the two-sided nature of apps and was based in part on the results of the field experiment. That analysis demonstrated that the FTC's claim that the acquisitions had led to increased ad load was not supported by the data. |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:feb:framed:00839 |
| By: | Natasha Aggarwal (TrustBridge Rule of Law Foundation); Renuka Sane (TrustBridge Rule of Law Foundation) |
| Abstract: | Indian financial regulators exercise significant quasi-legislative powers, but the processes governing how they make regulations remain fragmented. This paper evaluates the regulation-making frameworks adopted by six financial sector regulators - IRDAI, IBBI, IFSCA, PFRDA, SEBI, and RBI — against three principles of good regulationmaking: consultation, evidence-based regulation-making, and periodic review. It then assesses a randomly selected consultation paper issued by each regulator in 2025 against indicators derived from these principles and each regulator's own framework. We find that while all six regulators have adopted some form of instrument, these instruments vary considerably in legal form, substantive scope, and analytical ambition. Regulators operating under more demanding frameworks are more likely to clearly identify the regulatory problem in their consultation documents. However, this relationship is not linear: stronger frameworks do not consistently produce stronger performance on more analytically demanding requirements. No regulator - including those whose frameworks expressly require it - included a cost-benefit analysis in its consultation paper, and no regulator assessed available alternatives to direct regulation. Every regulator failed to comply with at least one of its own procedural requirements. The paper concludes with five reforms directed at legislative reform, mandatory regulatory impact assessment, expert committee structures, defined periodic review cycles, and the use of technology. |
| Date: | 2026–08 |
| URL: | https://d.repec.org/n?u=RePEc:bjd:wpaper:24 |
| By: | Cabon-Dhersin, Marie-Laure; Poyago-Theotoky, Joanna; Raffin, Natacha |
| Abstract: | We explore the interplay of competition and environmental policies to address the question of whether green antitrust has beneficial effects in terms of both environmental and consumer welfare performance. We focus on two environmental policy tools, an emission tax and an emission standard, and explore three particular configurations: competitive ‘green R&D, collaborative ‘green’ R&D in the form of a joint lab, and the benchmark case of no ‘green’ R&D. Firms compete in the product market by selling a homogeneous product, either by setting prices (Bertrand competition) or quantities (Cournot competition) while facing convex costs. We show that ‘green antitrust’ can unambiguously improve the effectiveness of environmental policy without undermining the interests of either consumers or producers, establishing a ‘win-win-win’ outcome. |
| Keywords: | Environmental Economics and Policy, Sustainability |
| Date: | 2026–08–31 |
| URL: | https://d.repec.org/n?u=RePEc:ags:feemwp:410235 |
| By: | Kamara, Irene (Tilburg Law School); Medzini, Rotem |
| Abstract: | This paper examines the significant yet underexplored role of notified bodies within the EU AI Act. These conformity assessment entities, once designated by national authorities and notified to the European Commission, are tasked with determining whether high-risk AI systems meet legal requirements to enter the EU market or put into service. Positioned between state regulators and providers of high-risk AI systems, notified bodies function as de facto gatekeepers, with the authority to allow or deny market access. Drawing on gatekeeping theory and regulatory governance literature, the paper conceptualises notified bodies as regulatory intermediaries who wield gatekeeping power despite not being state actors. The paper analyses their functions, accountability, and overall role, highlighting tensions arising from their quasi-public responsibilities and private nature. The paper argues for stronger safeguards to ensure legitimacy, transparency, and fundamental rights protection |
| Date: | 2026–08–13 |
| URL: | https://d.repec.org/n?u=RePEc:osf:socarx:gxvq2_v1 |
| By: | Mathilde Dufouleur |
| Abstract: | This paper examines the effects of cryptocurrency regulation on price deviations in the Bitcoin market, focusing on regulatory implementations rather than announcements. I construct a unique database of regulations across 28 countries since 2009, categorized into seven types, and analyse Bitcoin price data since September 2013. Our findings indicate that the Law of One Price does not hold in the Bitcoin market. Contrary to initial conjectures, more regulated markets exhibit higher price convergence with the USD benchmark. According to the type of regulation, this result is mixed. Regulations enhancing reliability and transparency, such as the expansion of securities laws, banking and payment regulations, and the implementation of regulatory sandboxes foster price convergence. In contrast, partial bans—primarily targeting banks—exacerbate price divergence, underscoring the significant role of financial institutions in the Bitcoin market. Additionally, anti-money laundering/countering the financing of terrorism (AML/CFT) laws reduce local prices regardless of USD price level, suggesting the cryptoasset's use in illicit activities.. |
| Keywords: | Cryptocurrency, Cryptocurrency Regulation, Price Convergence, Law of One Price, Financial Institutions, Anti-Money Laundering, Regulatory Impact |
| JEL: | G15 G18 E42 K22 |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:bfr:banfra:1052 |
| By: | Carlos L. Vega (University of East Anglia, School of Economics); Jestoni A. Olivo (Economics Office, Philippine Competition Commission); Antonio Miguel S. Ventura (Economics Office, Philippine Competition Commission); Eirene Gillian M. Reyes (University of the Philippines College of Law) |
| Abstract: | Change ownership reforms for electric cooperatives (ECs) have once again attracted policymakers’ interest due to current efforts in expediting their privatization. This note serves as input to this ongoing conversation using the lens of competition. We argue that unchecked consolidation - especially vertical integration along the power supply chain from generation to distribution - may cause more pernicious effects on the industry and welfare than existing inefficiencies of ECs. Consistent with Canlas & Jandoc (2025), we support a franchise competition regime where the threat of displacement may foster an overall competitive behavior among existing and potential players. The necessary conditions for and the challenges to implementing an effective competition for the market framework are determined. |
| Keywords: | market imperfections; legal monopolies; regulation or deregulation; electric utilities |
| JEL: | D43 L43 L94 |
| Date: | 2025–08 |
| URL: | https://d.repec.org/n?u=RePEc:phs:dpaper:202504 |
| By: | Daniel Lopez Garcia; Robert D. Metcalfe; Andrew R. Schein; Yixin Sun |
| Abstract: | As renewable generation plays a growing role in the energy system, periods of negative wholesale electricity prices are becoming increasingly common and are expected to grow dramatically over the next ten years. Traditionally, system operators respond by paying generators, especially renewables, to curtail production, or mandating that they do so without compensation. In this study, we propose and test a novel alternative: exposing consumers to free and negative prices to stimulate demand when supply is abundant. We implemented large-scale nationwide natural field experiments simultaneously in Great Britain and Spain, with roughly 60, 000 residential customers in each country randomized to receive varying financial incentives to “turn up” their electricity. We found that demand increased substantially as prices fell to zero, but paying customers to consume beyond zero price yielded little additional response. Households with electric vehicles and rooftop solar had a larger elasticity than households without such technologies, suggesting demand turn-up becomes more effective as households adopt low-carbon technologies. In Great Britain, consumption was largely shifted from adjacent hours, while in Spain the increase appeared to represent net new demand. We develop a welfare framework showing conditions under which demand turn-up improves on curtailment; we find that by inducing additional consumption in periods and locations where the marginal cost of supply is low, demand turn-up generates welfare gains that curtailment leaves uncaptured. |
| JEL: | Q4 Q41 |
| Date: | 2026–07 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:35530 |
| By: | John A. List; Matthias Rodemeier; Sutanuka Roy; Gregory K. Sun |
| Abstract: | Behavioral interventions have become central to modern public policy, but their empirical promise remains contested because estimated treatment effects often appear small. We argue that a policy response is economically meaningful only relative to the response generated by alternative policies. We assemble more than 1, 200 estimates from over 600 studies comparing “nudges” and traditional price interventions in the markets for cigarettes, alcohol, influenza vaccination, electricity, and residential water. Translating nudge effects into equivalent price changes, we find that behavioral interventions often correspond to enormous fiscal interventions, from an 11% tax on electricity to a 100% subsidy on influenza vaccinations. Nudges are also more cost-effective than price instruments in all markets, but cost-effectiveness does not predict the welfare ranking of policies. Using a behavioral extension of the Marginal Value of Public Funds, we show that nudges have high welfare returns at the margin, while price instruments often generate larger total surplus at scale. |
| JEL: | D61 D83 H21 I12 I18 Q41 Q48 |
| Date: | 2026–07 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:35567 |
| By: | Negar Mohammadi Jazi (London School of Economics); Felipe Netto (Bank of England) |
| Abstract: | We analyse how risk-based capital requirements shape competition and credit allocation in the UK unsecured Small and Medium-sized Enterprises (SME) lending market using confidential loan-level data. Motivated by empirical patterns, we develop and estimate a structural model with screening, asymmetric information, and imperfect competition, in which banks and non-bank lenders differ in regulatory treatment. We estimate lender-specific costs and screening precision, and show how these features jointly account for the observed lender market shares across borrower risk and loan size segments. Our results indicate that regulation interacts with heterogeneity in information processing and costs to shape equilibrium pricing and credit allocation, with non-bank lending reflecting not only regulatory differences but also comparative advantages in screening technology. Our model provides a quantitative framework for evaluating regulatory policy in markets with both regulated and non-regulated intermediaries. |
| Keywords: | Small business lending;asymmetric information;non-bank financial intermediaries;screening;capital regulation |
| JEL: | G20 G21 G23 G28 |
| Date: | 2026–06–19 |
| URL: | https://d.repec.org/n?u=RePEc:boe:boeewp:023313 |
| By: | Trein, Philipp (University of Lausanne); Maggetti, Martino |
| Abstract: | This paper explores the dual role of governments as both adopters and regulators of artificial intelligence (AI), focusing on the implications for democratic governance. As AI technologies become increasingly embedded in public administration – from policymaking to service delivery – they offer opportunities for improving efficiency and personalization but also raise concerns about transparency, accountability, and fairness. To deal with these questions, this paper examines how AI is framed as a policy problem, the regulatory approaches adopted in different political systems, and the politicization of AI governance. It also analyzes the democratic risks posed by algorithmic decision-making, polarization, and corporate concentration of power, while highlighting the potential of AI to enhance democratic quality through improved public services, inclusive discourse, and citizen engagement. The paper concludes by identifying key areas for future research, including legitimacy, trust, regulatory design, and equity in AI governance. |
| Date: | 2026–08–15 |
| URL: | https://d.repec.org/n?u=RePEc:osf:socarx:rcqbt_v1 |
| By: | Mehdi Guelmamen; Iannis Reuter |
| Abstract: | Mandated consolidation of local utilities transfers tariff-setting authority to a larger jurisdiction, which is then expected to charge a single price. We show that it does not, and we identify what stands in the way. Using the universe of French wastewater services over 2008–2024, we follow 1, 937 municipal services through the transfer of their competence to an intermunicipal body and measure how fast the receiving authority harmonises the tariffs it inherits. Convergence is real but slow: a service whose tariff exceeded the average of its new perimeter by one euro per cubic metre closes twenty-nine per cent of that gap on average and half of it after five years, with no plateau in sight. Consolidated authorities do not merge the services they take over: the number of separate tariff perimeters per authority is unchanged five years on. The binding constraint appears contractual rather than political: comparing each delegated service with itself, convergence runs at fifteen per cent while its concession is still in force and at thirty-eight per cent once it has expired. Harmonisation, when it comes, falls on the smallest members of the new perimeter, whose tariffs rise by up to a quarter. Creating a single tariff-setting authority does not create a single tariff, and the speed at which one emerges is governed by the maturities of contracts signed before the reform. |
| Keywords: | Wastewater services, Water tariffs, Intermunicipal cooperation, Uniform pricing, Cross-subsidies, Concession contracts |
| JEL: | L95 L51 H77 Q25 |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:ulp:sbbeta:2026-28 |
| By: | Janusz Bialek |
| Keywords: | Power system blackouts, security of supply, Iberian blackout 2025 |
| JEL: | L94 L98 Q40 Q48 Q42 |
| Date: | 2026–08 |
| URL: | https://d.repec.org/n?u=RePEc:enp:wpaper:eprg2619 |
| By: | Nikola Rakonjac; Phoebe Koundouri (Dept. of International and European Economic Studies, Athens University of Economics and Business); Slobodan Djordjevic; Zarko Sretenovic; Dragan Savic |
| Abstract: | The European Union's revised Urban Waste Water Treatment Directive (UWWTD, Directive 2024/3019), in force since 1 January 2025, marks a major step toward the Zero Pollution ambition. By imposing stricter wastewater collection, treatment, and pollutant removal regulations, the directive aims to significantly enhance water quality and environmental protection across Europe. While these measures align with longterm sustainability goals, they pose considerable challenges for EU candidate countries, which must adapt their infrastructure and policies to meet compliance requirements within the next two decades. Chapter 27 of the latest European Commission Enlargement Package highlights disparities in environmental compliance among EU candidate countries, underscoring that progress on water quality, water management, and wastewater treatment remains limited. This is further reflected in the countries' performance on Sustainable Development Goal 6 (SDG 6) - "Ensure availability and sustainable management of water and sanitation for all". |
| Date: | 2026–09–01 |
| URL: | https://d.repec.org/n?u=RePEc:aue:wpaper:2622 |
| By: | OECD |
| Abstract: | This paper examines the challenges faced by competition authorities in Latin America and the Caribbean (LAC) when enforcing competition law in markets affected by informality. Informal markets represent a significant share of economic activity in the region and may influence competitive dynamics both where informal firms compete with formal firms and where competition occurs within informal markets. The paper focusses on competition enforcement issues related to informality including the definition of relevant markets, the investigation of informal firms and the calculation of fines. Although informality can create substantial evidentiary and procedural difficulties, the paper identifies opportunities for competition authorities to mitigate those challenges, including the use of official datasets, market studies and institutional co-operation with organisations addressing informality. The paper argues that competition authorities in LAC should be mindful of informal markets when enforcing competition law, and can apply proportionate, pragmatic and targeted enforcement to address competitive harm involving informal markets, while supporting better market functioning and the transition towards formality. |
| Keywords: | competition law enforcement, informal economy, informal markets, Latin America and the Caribbean (LAC) |
| JEL: | K21 K42 L40 L41 |
| Date: | 2026–09–14 |
| URL: | https://d.repec.org/n?u=RePEc:oec:dafaac:337-en |
| By: | OECD |
| Abstract: | This paper provides an overview of the state of play of early resolution of cartel cases in Latin America and the Caribbean (LAC) jurisdictions, covering the legal framework, enforcement experiences, as well as challenges and particularities. Competition authorities may benefit from the early resolution of cartel cases by saving on time and the resources that the case would require in an adversarial procedure, allocating them more efficiently to the detection and prosecution of other cartels and providing for a greater deterrence and wider impact of their enforcement actions. The paper highlights that LAC competition authorities may consider designing and using these tools as a way to achieve procedural expediency. The design and implementation of early resolution programmes requires consideration of the incentives of parties to resolve cases early and the interplay with leniency programmes, damages and the pursuit of other policy objectives. |
| Keywords: | cartel enforcement, competition law enforcement, early case resolution, Latin America and the Caribbean (LAC), settlements |
| JEL: | K21 K40 |
| Date: | 2026–09–14 |
| URL: | https://d.repec.org/n?u=RePEc:oec:dafaac:338-en |